organization change7th edition APA formatted paper

CLA 1 Comprehensive Learning Assessment – CLO 1, CLO 2, CLO 3

This CLA1 requires that you define what are the systems of resistance, and provide some understanding by answering the following questions:

What symptoms of resistance to change have you experienced? Have you experienced both active and passive forms? Have you experienced them as a resistor yourself (as a recipient of change)? Have you experienced them as someone responsible for the management of change (as an initiator of change)? note !!!(I have no experienced)
Which of the various reasons for resisting change do you believe to be the most common? What are your “top three” in this regard?
Which of the various reasons for resisting change do you believe to be the most difficult to deal with (as a manager)? What are your “top three” in this regard?
When senior managers resist change at the strategic level, they are in a position to cause more damage than employees resisting changes at the operational level. Have you worked in a company where you believe that management resistance to change may have existed? As a manager yourself, what would you try to do to prevent this from happening?
Which approach to the management of resistance attracts you? What is the reason for your choice? For example, is it because you believe it to be the most effective or does it also relate to a view that you have about how people should be managed?

*Please refer to the Grading Criteria for Comprehensive Learning Assessments (CLAs) in the University Policies for specific guidelines and expectations.

4-5 pages

Remember folw APA 7th

2021/1/28 Managing Organizational Change – Encyclopedia – Business Terms | Inc.com

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Managing Organizational Change

Related Terms: Organizational Growth

Organizational change occurs when a company makes a transition from its current

state to some desired future state. Managing organizational change is the process of

planning and implementing change in organizations in such a way as to minimize

employee resistance and cost to the organization while simultaneously maximizing the

e�ectiveness of the change e�ort.

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Today’s business environment requires companies to undergo changes almost constantly if

they are to remain competitive. Factors such as globalization of markets and rapidly

evolving technology force businesses to respond in order to survive. Such changes may be

relatively minor—as in the case of installing a new software program—or quite major—as

in the case of refocusing an overall marketing strategy, �ghting o� a hostile takeover, or

transforming a company in the face of persistent foreign competition.

Organizational change initiatives often arise out of problems faced by a company. In some

cases, however, companies change under the impetus of enlightened leaders who �rst

recognize and then exploit new potentials dormant in the organization or its

circumstances. Some observers, more soberly, label this a “performance gap” which able

management is inspired to close.

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But organizational change is also resisted and—in the opinion of its promoters—fails. The

failure may be due to the manner in which change has been visualized, announced, and

implemented or because internal resistance to it builds. Employees, in other words,

sabotage those changes they view as antithetical to their own interests.

AREAS OF ORGANIZATIONAL CHANGE

Students of organizational change identify areas of change in order to analyze them. Daniel

Wischnevsky and Fariborz Daman, for example, writing in Journal of Managerial Issues,

single out strategy, structure, and organizational power. Others add technology or the

corporate population (“people”). All of these areas, of course, are related; companies often

must institute changes in all areas when they attempt to make changes in one. The �rst

area, strategic change, can take place on a large scale—for example, when a company shifts

its resources to enter a new line of business—or on a small scale—for example, when a

company makes productivity improvements in order to reduce costs. There are three basic

stages for a company making a strategic change: 1) realizing that the current strategy is no

longer suitable for the company’s situation; 2) establishing a vision for the company’s

future direction; and 3) implementing the change and setting up new systems to support it.

Technological changes are often introduced as components of larger strategic changes,

although they sometimes take place on their own. An important aspect of changing

technology is determining who in the organization will be threatened by the change. To beNEWSLETTERS LEAD INNOVATE GROW
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successful, a technology change must be incorporated into the company’s overall systems,

and a management structure must be created to support it. Structural changes can also

occur due to strategic changes—as in the case where a company decides to acquire another

business and must integrate it—as well as due to operational changes or changes in

managerial style. For example, a company that wished to implement more participative

decision making might need to change its hierarchical structure.

People changes can become necessary due to other changes, or sometimes companies

simply seek to change workers’ attitudes and behaviors in order to increase their

e�ectiveness or to stimulate individual or team creative-ness. Almost always people changes

are the most di�cult and important part of the overall change process. The science of

organization development was created to deal with changing people on the job through

techniques such as education and training, team building, and career planning.

RESISTANCE TO CHANGE

A manager trying to implement a change, no matter how small, should expect to

encounter some resistance from within the organization. Resistance to change is normal;

people cling to habits and to the status quo. To be sure, managerial actions can minimize or

arouse resistance. People must be motivated to shake o� old habits. This must take place in

stages rather than abruptly so that “managed change” takes on the character of “natural

change.” In addition to normal inertia, organization change introduces anxieties about the

future. If the future after the change comes to be perceived positively, resistance will be less.

Education and communication are therefore key ingredients in minimizing negative

reactions. Employees can be informed about both the nature of the change and the logic

behind it before it takes place through reports, memos, group presentations, or individual

discussions. Another important component of overcoming resistance is inviting employee

participation and involvement in both the design and implementation phases of the
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change e�ort. Organized forms of facilitation and support can be deployed. Managers can

ensure that employees will have the resources to bring the change about; managers can

make themselves available to provide explanations and to minimize stress arising in many

scores of situations.

Some companies manage to overcome resistance to change through negotiation and

rewards. They o�er employees concrete incentives to ensure their cooperation. Other

companies resort to manipulation, or using subtle tactics such as giving a resistance leader a

prominent position in the change e�ort. A �nal option is coercion, which involves

punishing people who resist or using force to ensure their cooperation. Although this

method can be useful when speed is of the essence, it can have lingering negative e�ects on

the company. Of course, no method is appropriate to every situation, and a number of

di�erent methods may be combined as needed.

TECHNIQUES FOR MANAGING CHANGE EFFECTIVELY

Managing change e�ectively requires moving the organization from its current state to a

future desired state at minimal cost to the organization. Key steps in that process are:

1. Understanding the current state of the organization. This involves identifying

problems the company faces, assigning a level of importance to each one, and

assessing the kinds of changes needed to solve the problems.

2. Competently envisioning and laying out the desired future state of the

organization. This involves picturing the ideal situation for the company after the

change is implemented, conveying this vision clearly to everyone involved in the

change e�ort, and designing a means of transition to the new state. An important

part of the transition should be maintaining some sort of stability; some things—

such as the company’s overall mission or key personnel—should remain constant

in the midst of turmoil to help reduce people’s anxiety.
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3. Implementing the change in an orderly manner. This involves managing the

transition e�ectively. It might be helpful to draw up a plan, allocate resources,

and appoint a key person to take charge of the change process. The company’s

leaders should try to generate enthusiasm for the change by sharing their goals

and vision and acting as role models. In some cases, it may be useful to try for

small victories �rst in order to pave the way for later successes.

Change is natural, of course. Proactive management of change to optimize future

adaptability is invariably a more creative way of dealing with the dynamisms of industrial

transformation than letting them happen willy-nilly. That process will succeed better with

the help of the the company’s human resources than without.

BIBLIOGRAPHY

Gilley, Ann. The Manager as Change Leader. Praeger, 2005.

“The Industry Isn’t Changing. It Has Changed!” Beef. 13 March 2006.

Lawler III, Edward E. and Christopher G. Worley. “Winning Support for Organizational

Change: Designing employee reward system that keep on working.” Ivey Business Journal

Online. March-April 2006.

Murray, Art and Kent Greenes. “The Enterprise of the Future.” KMWorld. March 2006.

Schneider, Dan. “It’s a Leader’s Duty to Manage Change.” Business Record (Des Moines). 20

February 2006.

Schraeder, Mike, Paul M. Swamidass, and Rodger Morrison. “Employee Involvement,

Attitudes and Reactions to Technology Changes.” Journal of Leadership & Organizational

Studies. Spring 2006.

Wallington, Patricia M. “Making Change.” CIO. 1 April 2000.

Wischenvsky, J. Daniel and Fariborz Damanpour. “Organizational Transformation and

Performance: An examination of three perspectives.” Journal of Managerial Issues. Spring

2006.
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Organizational change is inevitable, and we all need to deal with it occasionally. But when

you are a manager, you’re responsible not only for yourself, but also for helping your team

navigate the changes. Everyone knows change creates stress, but did you know that

organizational change is one of the top workplace stressors? The good news is there are

lots of things you can do to ease the way for your team.

Announcing change

We’ll talk about two types of organizational change in this article: reorganizations and

process change. Regardless of the type of change going on, it’s important for you to share

changes as soon as you can to avoid rumor and anxiety. Whenever you are announcing

change, you should focus on why the change is happening, the impact to the organization

and finally, the impact to your direct team. Some changes will create more emotional

response than others. If the change is emotionally charged for you, work on managing your

emotion by focusing on the facts and the ways you can help.

When you are describing change to your team, you should focus on opportunities created

by the change. Of course, there may be threats and down sides to the situation. Be realistic

and honest about the level of difficulty in the change. But even if you don’t agree with the

changes taking place, you need to let the team know that your job is to put them in place.

So, you can, and should, discuss the “elephants” in the room – but you should shift the

focus to what is going to happen going forward instead of dwelling on the downside.

Reorganizations

Reorganizations create a lot of stress. Rumors can fly for weeks, even months sometimes,

when major reorganizations are in the works and people can have a lot of time to

speculate. Managers don’t always have a lot of time before public announcements. But

whenever possible, you should communicate role changes privately before any public

announcements. Then, of course, talk to the team about the change and impact to the

team. If everyone is not aware of the impact for themselves personally, don’t give details

about individuals. Let the team know when you’ll be communicating the new organigram for

the team.

Get time with each of your team members to discuss personal impact. If you have new team

members joining the team, you’ll want to spend a bit more time with them. Have a

discussion about their experience and skills. Share your management style and principles

with them and let them know how the team works together. In situations where employees

have been moved around a lot due to reorganizations, you’ll want to reassure them as best

you can. Often, just taking the time to have such a discussion can go a long way towards

reassuring anxious team members. Formally introduce them to the team. Ask everyone to

share their roles and something about themselves.

A discussion with the previous manager of team members moving into your team is an

important step. Get an update on their perspective, the team member’s salary and

performance. For team members moving to other teams, you’ll want to debrief their new

managers in a similar fashion.

Finally, if your own manager changes, prepare a clear view of the team, key projects, known

issues and your management system. Enquire about their management system and start

getting to know their communication and leadership style. Help them get to know you as

well by sharing your career trajectory and key skills – both those used in your current role

and any untapped skills you aren’t being called on to use currently.

Don’t just assume that once the change is introduced, everything will work fluidly. Keep an

eye on how things evolve. Some people adapt quickly and easily to change, others need

more time and encouragement.

Process change

Digital transformation is disrupting legacy work processes and how things get done. New

processes are meant to be more efficient and effective. The reality is, process change can

have the opposite effect for some time before it is understood and becomes deeply

rooted. As a manager, you play a key role in easing this transition for your team.

0 Likes

When you are communicating the change, it’s helpful to name a focal point who will share

new information, become the “team expert”, and collect questions and issues. That could

be you or it could be a member of your team. You can also assign specific topics to

individual team members and have them share back what they learned with the rest of the

team.

Make sure you are sharing the training documents for the new process. If there are multiple

things under transformation in parallel, you may want to provide recommendations for your

team for prioritization. Help the team understand where they should focus first, and the best

way to get started. That can take the form of a structured training plan or a less formal set of

recommendations.

Keep a pulse on what’s working and what isn’t. If there is a company focal point for the

change, keep them informed of the major issues and barriers to progress. Keep the team

informed – either through direct participation in updates or by recapping for them. Identify

the experts on the new process and help your team to connect with them when

appropriate.

In the era of Agile, process change often comes in increments and new processes may be

rolled out before they are completely ready for prime time. Frustrations will run high when

process change interrupts and hinders daily business needs. Help your team to level-set on

what is possible and what is not. Identify the impact and make sure your management is

aware. Encourage the team to focus on what they can do and help them troubleshoot

overcoming new obstacles.

Finally, talk to your peers and other managers who are managing the transformation. Share

the experience your team is having. Learn how other teams are overcoming the obstacles.

It’s empowering to know that you aren’t alone, and your team members should understand

the level of difficulty being experienced across the organization. It’s not about whining

about how hard it is – it’s about realizing that the issues are understood, and that the

situation will evolve.

Change is hard. But as a manager, you can make it easier for your team by the way you

handle it. Communicate. Stay involved. Keep the team focused. Step by step, change

becomes routine again.

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Managing Organizational Change

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Managing Organizational Change

Scope—This article provides an overview of key considerations in planning and implementing
major organizational changes. It focuses mainly on the scope and impact of change on business,
steps to take to ensure the success of organizational change initiatives, and how to overcome
common obstacles encountered during change. Additionally, this article highlights HR issues and
challenges in handling specific types of major organizational change.

Overview

Change management is the systematic approach and application of knowledge, tools and resources to deal with change. It

involves de�ning and adopting corporate strategies, structures, procedures and technologies to handle changes in external

conditions and the business environment. E�ective change management goes beyond project management and technical tasks

undertaken to enact organizational changes and involves leading the “people side” of major change within an organization. The

primary goal of change management is to successfully implement new processes, products and business strategies while

minimizing negative outcomes.

This article discusses the management of large organizational changes that may have far-reaching impacts on the organization

and its workforce, including the following topics:

The nature and extent of organizational

change.

The business case for a systematic approach to change management.

The roles of management and HR during major change initiatives.

Steps to take in managing organizational change.

How to overcome common obstacles encountered during organizational change.

Legal and global considerations in managing change.

This article also highlights some of the special issues and challenges in implementing certain types of major organizational

change, including mergers and acquisitions, downsizing, bankruptcy, business closure, outsourcing, and changes within the HR

function.

Background

To keep pace in a constantly evolving business world, organizations often need to implement enterprisewide changes a�ecting

their processes, products and people. Change is a fact of life in businesses today. It can be di�cult, and people often resist it.

But to develop an agile workplace culture, organizations should follow a systematic approach to managing major change.

Organizational development experts have established approaches for successfully navigating through change.

Organizational leaders must identify and respond quickly to market changes and unexpected challenges, but most are not in a

position to create an agile culture. Yet agile leadership—from CEOs down to line-level managers—separates high-performing

from lower-performing organizations. Companies that consistently outperform competitors in pro�tability, market share, revenue

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growth and customer satisfaction reported much greater agility than lower performers. See Don’t Just Adapt to Change—Lead It

(www.shrm.org/hr-today/news/hr-magazine/0817/pages/do-not-just-adapt-to-change-lead-it.aspx).

Business Case

The rate of major organizational change has accelerated dramatically in this decade. Global research and advisory company

Gartner reports that the average organization has undergone �ve enterprise changes in the past three years and 73% of

organizations expect more change initiatives in the next few years.

As change initiatives have become more frequent and widespread, the importance of managing individuals through change has

gained credence. Major changes can a�ect organizations across all levels. Many corporate leaders have concluded that failing

to manage employees through change can be costly: Employees who are dissatis�ed with or upset by change are generally

less productive.

An employer that is serious about change management should develop a communication plan, a road map for change

sponsors, integrated training programs and a plan for dealing with resistance. See SHRM Foundation Report a Primer for

Change Management (www.shrm.org/resourcesandtools/hr-topics/organizational-and-employee-development/pages/shrm-

foundation-report-change-management.aspx).

HR should be involved in major organizational changes from the beginning and can assist by in�uencing the following:

Improving employees’ understanding of change.

Increasing communication between management and employees.

Identifying and mitigating risks.

Enhancing employee satisfaction.

Boosting trust between management and employees.

Improving employee skills and pro�ciency through change-related training initiatives.

See How Leaders Can Help Employees Accept Technology Changes. (www.shrm.org/hr-today/news/hr-

magazine/0716/pages/how-leaders-can-help-employees-accept-technology-changes.aspx)

The Roles of Management and HR

Business managers who want to undertake major transformation to stay competitive must work with HR sta� to gain employee

acceptance and support.

Management’s role

Having the right leadership and buy-in from the executive team is critical to unifying the organization behind a common

strategic direction.

Another key is making sure all managers are equipped to coach their direct reports toward commitment. One-on-one

conversations help individual team members analyze how the change will a�ect them, determine their level of commitment and

choose how they will act. Questions managers should address with employees

include:

What is changing?

Why is it changing?

How will it a�ect your area?

How will it a�ect you directly?

See Changing the Change Rules at Google (https://blog.shrm.org/blog/changing-the-change-rules-at-google-0).

https://www.shrm.org/hr-today/news/hr-magazine/0817/pages/do-not-just-adapt-to-change-lead-it.aspx

https://www.shrm.org/resourcesandtools/hr-topics/organizational-and-employee-development/pages/shrm-foundation-report-change-management.aspx

https://www.shrm.org/hr-today/news/hr-magazine/0716/pages/how-leaders-can-help-employees-accept-technology-changes.aspx

https://blog.shrm.org/blog/changing-the-change-rules-at-google-0

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Unfortunately, many managers are not adept at change management. The lack of change management skills among managers

can make change initiatives di�cult to achieve. A Towers Watson Change and Communication ROI Survey found that 87

percent of employers train managers on e�ective change management; however, only one-quarter of those employers found

the training to be e�ective. To increase managers’ skills, HR should provide training that is tailored to the speci�c change

initiative and the competencies necessary to lead successful change. See Leadership Critical to Organization Change E�orts

(www.shrm.org/hr-today/news/hr-news/Pages/leadershipcriticaltochangee�orts.aspx) and Senior Leader Accountability: Critical

to Successful Change (www.shrm.org/ResourcesAndTools/hr-topics/organizational-and-employee-

development/Pages/SeniorLeaderAccountability.aspx).

HR’s role

HR can play a dual role in change management by initiating and leading the change and by serving as a facilitator for changes

that other leaders and departments initiated. See What is HR’s Role in Managing Change? (www.shrm.org/hr-today/trends-and-

forecasting/special-reports-and-expert-views/pages/deb-cohen.aspx) and HR Can Improve Employee Buy-In for Organizational

Change (www.shrm.org/ResourcesAndTools/hr-topics/organizational-and-employee-development/Pages/ImproveBuyIn.aspx).

The HR department performs a variety of functions associated with the communication, implementation and tracking of major

changes. Most commonly, HR professionals assist employees by serving as a point of contact for questions and concerns and

by explaining any impact on sta�ng. In addition, HR often coordinates meetings and communications about the change and

related initiatives. Other common HR roles and responsibilities include:

Providing initial employee communications about changes.

Developing training programs.

Preparing informational documents.

Assessing readiness before the change.

Analyzing potential impact.

HR can also play a strategic role in change management by calculating the post-implementation return on investment by

identifying key performance indicators (KPIs) to be measured and by tracking and communicating these results.

By championing change, HR can help the organization increase buy-in, comfort and support for change across departments,

thereby increasing the success of change initiatives. See Managing Organizational Change with an HR Department of One

(www.shrm.org/resourcesandtools/hr-topics/behavioral-competencies/relationship-management/pages/managing-

organizational-change-with-an-hr-department-of-one.aspx).

Steps in the Change Management Process

Organizations should systematically prepare for and implement major organizational change. John Kotter, a Harvard Business

School professor, developed a well-known and widely adopted approach for managing organizational change. This approach,

updated in Kotter’s book Accelerate, involves the following eight stages:

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https://www.shrm.org/ResourcesAndTools/hr-topics/organizational-and-employee-development/Pages/SeniorLeaderAccountability.aspx

https://www.shrm.org/hr-today/trends-and-forecasting/special-reports-and-expert-views/pages/deb-cohen.aspx

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1. “Create a sense of urgency.” Successful transformation e�orts usually begin when leaders examine the market for

changes that may lead to new competitive realities for the organization. These changes can stem from demographic

shifts, social trends, new technology, market or competitor changes, or new government regulations. The leaders

should explain that a potential crisis or major opportunity is imminent, and they should encourage frank discussion

throughout the organization. Creating a sense of urgency that the status quo is no longer acceptable is essential to gain

the workforce’s energetic cooperation.

2. “Build a guiding coalition.” Once employees feel a sense of urgency, leaders should establish a group with

enough power to lead the change. Members need substantial authority based on position, expertise, credibility and

leadership, as well as e�ective management skills and proven leadership abilities. This coalition must learn to work

together based on trust and set a common goal. Many guiding coalitions build trust through o�site meetings, joint

activities and conversation.

3. “Form a strategic vision and initiatives.” The guiding coalition should craft a clear vision for the future, motivate

people to take appropriate actions and coordinate their actions. An e�ective vision is imaginable, desirable, feasible,

focused, �exible and communicable, according to Kotter. Creating an e�ective vision takes time and can be a

challenging process, but the end product provides a clear direction for the future.

4. “Enlist a volunteer army.” Once the guiding coalition has developed the vision, its members should provide

extensive communications about how the change will improve the business and how those improvements will bene�t

employees. Key elements in e�ective communications include simplicity, use of examples, multiple forums, repetition,

explanation of apparent inconsistencies and two-way communication. The group should model the behavior expected

of employees.

5. “Enable action by removing barriers.” To empower workers to support change and act on the vision, change

leaders should identify and remove obstacles. Four categories of important obstacles are:

�. Formal structures that make it di�cult for employees to act.

�. A lack of needed skills.

�. Personnel or information systems.

�. Supervisors who discourage actions toward implementing the new vision.

6. “Generate short-term wins.” Successful and enduring change takes time, which can be discouraging to employees

at all levels of the organization. To maintain urgency, leaders should create conditions that support early successes and

visible improvements. The key is to actively search for opportunities to score early achievements and to recognize and

reward those who made these accomplishments possible. Good short-term wins have unambiguous results, are visible

to many people and are clearly related to the change e�ort.

7. “Sustain acceleration.” Until major changes are embedded in an organization’s culture (which could take up to a

decade), they remain vulnerable to resistance and regression. It is important to use the early successes as a foundation

for larger challenges and to revise all systems, structures and policies that do not �t the change vision. HR can

consolidate gains by hiring, promoting and developing employees who can implement the transformation vision.

Additionally, the change process can be reinvigorated with new project themes and change agents.

8. “Institute change.” The �nal stage in Kotter’s model for successful change is linking the changes to two key

components of corporate culture—norms of group behavior and shared values.

Another model for organizational change includes a four-phase change management process:

�. De�ne—Align expectations regarding the scope of the change as well as timing and business impact.

�. Plan—Understand how the change will impact stakeholders and design a strategy to help them navigate it.

�. Implement—Engage with leaders and associates to execute the change.

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�. Sustain—Work with leaders and employees to track adoption and drive lasting change.

A large global retailer uses this model to increase the speed and impact of change initiatives while reducing the downturn of

performance, thereby achieving desired outcomes quicker.

Overcoming Common Obstacles Encountered in Implementing Change

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Organizations can have a clear vision for changes and a technically and structurally sound foundation for making changes, but

the initiatives can still �ounder due to obstacles that arise. Employee resistance and communication breakdown are common

obstacles faced during major organizational change. See How to Avoid Common Mistakes in Change Management

(www.shrm.org/hr-today/news/hr-magazine/0218/pages/how-to-avoid-common-mistakes-in-change-management.aspx).

Employee resistance

Successful change starts with individuals, and failure often occurs because of human nature and reluctance to change.

Employees may also lack the speci�c behavioral traits needed to adapt easily to changing circumstances, which could

decrease employee engagement and e�ectiveness and put organizational productivity at risk. How organizations treat workers

during a change initiative determines how successful the change—and the organization—will be.

There are six states of change readiness: indi�erence, rejection, doubt, neutrality, experimentation and commitment.

Organizations about to embark on a transformation should evaluate workforce readiness with assessment instruments and

leader self-evaluations to identify the areas in which the most work is needed.

Leaders should have a solid strategy for dealing with change resistance. Some actions to build employee change readiness

include:

Developing and cascading strong senior sponsorship for people-focused work. In the absence of visible sponsorship,

leaders should build alliances, meet business needs and promote wins.

Developing tools and information for front-line supervisors and managers. Organizations should involve them early—

train them, prepare them and communicate regularly.

Coaching employees to help them adapt and thrive during change.

Rewarding desired behaviors and outcomes with both tangible and intangible rewards.

Relying on insights from both those in the �eld and subject-matter experts.

See Is Change Stressing Your Workers? Turn to a Millennial (www.shrm.org/resourcesandtools/hr-topics/behavioral-

competencies/global-and-cultural-e�ectiveness/pages/millennials-and-change.aspx) and Wanted: Workers Who Can Adapt to

Change (www.shrm.org/hr-today/news/hr-magazine/0617/pages/workers-who-can-adapt-to-change.aspx).

Communication breakdown

Sometimes decisions about major organizational changes are made at the top management level and then trickle down to

employees. As a result, why and how the company is changing may be unclear. According to a Robert Half Management

Resources survey, poor communication commonly hinders organizational change-management e�orts, with 65 percent of

managers surveyed indicating that clear and frequent communication is the most important aspect when leading through

change.

To avoid this problem, HR should be involved in change planning early to help motivate employees to participate. E�ective

communication promotes awareness and understanding of why the changes are necessary. Employers should communicate

change-related information to employees in multiple forms (e.g., e-mails, meetings, training sessions and press releases) and

from multiple sources (e.g., executive management, HR and other departments). See Why United Airlines’ Lottery-Based Bonus

Idea Fell Flat (www.shrm.org/resourcesandtools/hr-topics/employee-relations/pages/united-airlines-bonuses-by-lottery-.aspx).

To avoid communication breakdowns, change leaders and HR professionals should be aware of �ve change communication

methodologies—from those that provide the greatest amount of information to those that provide the least:

“Spray and pray.” Managers shower employees with information, hoping they can sort signi�cant from insigni�cant. The

theory is that more information equates to better communication and decision-making.

https://www.shrm.org/hr-today/news/hr-magazine/0218/pages/how-to-avoid-common-mistakes-in-change-management.aspx

https://www.shrm.org/resourcesandtools/hr-topics/behavioral-competencies/global-and-cultural-effectiveness/pages/millennials-and-change.aspx

https://www.shrm.org/hr-today/news/hr-magazine/0617/pages/workers-who-can-adapt-to-change.aspx

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“Tell and sell.” Managers communicate a more limited set of messages, starting with key issues, and then sell

employees on the wisdom of their approach. Employees are passive receivers, and feedback is not necessary.

“Underscore and explore.” Managers develop a few core messages clearly linked to organizational success, and

employees explore implications in a disciplined way. Managers listen for potential misunderstandings and obstacles.

This strategy is generally the most e�ective.

“Identify and reply.” Executives identify and reply to key employee concerns. This strategy emphasizes listening to

employees; they set the agenda, while executives respond to rumors and innuendoes.

“Withhold and uphold.” Executives withhold information until necessary; when confronted by rumors, they uphold the

party line. Secrecy and control are implicit. The assumption is that employees are not sophisticated enough to grasp the

big picture.

Experts estimate that e�ective communication strategies can double employees’ acceptance of change. However, often

companies focus solely on tactics such as channels, messages and timing while failing to do a contextual analysis and consider

the audience. Some of the speci�c communication pitfalls and possible remedies for them are the following:

The wrong messengers are used. Studies have found that employees tend to trust information from managers.

Understanding the organization’s culture will dictate who is the best messenger for change—the manager, the senior

executive team or HR.

The change is too sudden. Leaders and managers need to prepare employees for change, allow time for the message

to sink in and give them an opportunity to provide feedback before a change is initiated.

Communication is not aligned with business realities. Messages should be honest and include the reasons behind the

change and the projected outcomes.

Communication is too narrow. If the communication focuses too much on detail and technicalities and does not link

change to the organization’s goals, it will not resonate with employees.

Executive leaders and HR professionals must be great communicators during change. They should roll out a clear, universal,

consistent message to everyone in the organization at the same time, even across multiple sites and locations. Managers

should then meet both with their teams and one on one with each team member. See Say What?! Honing Communication Skills

at the Top (www.shrm.org/ResourcesAndTools/hr-topics/organizational-and-employee-

development/Pages/HoningCommunicationSkills.aspx).

Leaders should explain the change and why it is needed, be truthful about its bene�ts and challenges, listen and respond to

employees’ reactions and implications, and then ask for and work to achieve individuals’ commitment. See Keep it Clear: Three

Ways to Help Communicate Change in Your Organization (https://blog.shrm.org/blog/keep-it-clear-three-ways-to-help-

communicate-change-in-your-organization) and Managing Organizational Communication

(www.shrm.org/ResourcesAndTools/tools-and-samples/toolkits/pages/managingorganizationalcommunication.aspx).

Other obstacles

Employee resistance and communication breakdowns are not the only barriers that stand in the way of successful change

e�orts. Other common obstacles include:

Insu�cient time devoted to training about the change.

Sta� turnover during the transition.

Excessive change costs.

An unrealistic change implementation timeline.

Insu�cient employee participation in voluntary training.

Software/hardware malfunctions.

https://www.shrm.org/ResourcesAndTools/hr-topics/organizational-and-employee-development/Pages/HoningCommunicationSkills.aspx

https://blog.shrm.org/blog/keep-it-clear-three-ways-to-help-communicate-change-in-your-organization

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Downturn in the market or the economy.

See How Leaders Can Help Employees Accept Technology Changes. (www.shrm.org/hr-today/news/hr-
magazine/0716/pages/how-leaders-can-help-employees-accept-technology-changes.aspx)

Change management experts have suggested that unsuccessful change initiatives are often characterized by the following:

Being too top-down. Executives relate their vision of what the end result of the change initiative should be, but do not

give direction or communication on how the managers should make the change happen.

Being too “big picture.” The organization’s leaders have a vision of the change but no idea of how that change will

a�ect the individuals who work there.

Being too linear. Managers work the project plan from start to �nish without making even necessary adjustments.

Being too insular. Most organizations do not seek outside help with change initiatives, but businesses may need

objective external input or assistance to accomplish major changes.

Successful change management must be well-planned, well-timed and well-integrated. Other critical success factors include a

structured, proactive approach that encompasses communication, a road map for the sponsors of the change, training

programs that go along with the overall project and a plan for dealing with resistance. Change leaders need to be active and

visible in sponsoring the change, not only at the beginning but also throughout the process. Turning their attention to

something else can send employees the wrong message—that leaders are no longer interested. See Executive Brie�ng: How to

Combat Change Fatigue (www.shrm.org/hr-today/news/hr-magazine/pages/0415-execbrief.aspx) and Dan Heath: Find the

‘Bright Spots’ to Generate Change. (www.shrm.org/ResourcesAndTools/hr-topics/bene�ts/Pages/DanHeath.aspx)

Managing Varied Types of Major Organizational Change

Organizational change comes in many forms. It may focus on creating new systems and procedures; introducing new

technologies; or adding, eliminating or rebranding products and services. Other transformations stem from the appointment of a

new leader or major sta�ng changes. Still other changes, such as downsizing or layo�s, bankruptcy, mergers and acquisitions,

or closing a business operation, a�ect business units or the entire organization. Some changes are internal to the HR function.

In addition to the general framework for managing change, change leaders and HR professionals should also be aware of

considerations relating to the particular type of change being made. The subsections below highlight some of the special issues

and HR challenges.

Mergers and acquisitions

A merger is generally de�ned as the joining of two or more organizations under one common ownership and management

structure. An acquisition is the process of one corporate entity acquiring control of another by purchase, stock swap or some

other method. Nearly two-thirds of all mergers and acquisitions (M&As) fail to achieve their anticipated strategic and �nancial

objectives. This rate of failure is often attributed to HR-related factors, such as incompatible cultures, management styles, poor

motivation, loss of key talent, lack of communication, diminished trust and uncertainty of long-term goals.

HR professionals face several challenges during M&As, including the following:

Attempting to maintain an internal status quo or to e�ect change—either to facilitate or thwart (in the case of a hostile

takeover) a possible merger or acquisition, as instructed by upper management.

Communicating with employees at every step in the M&A process with appropriate levels of disclosure and secrecy.

Devising ways to meld the two organizations most e�ectively, e�ciently and humanely for the various stakeholders.

Dealing with the reality that M&As usually result in layo�s of super�uous employees. This process entails coordinating

separation and severance pay issues between the combining organizations.

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Addressing the ethical dilemmas involved, such as when an HR professional may be required to eliminate his or her

own position or that of a co-worker or an HR counterpart in the combined organization.

Downsizing

Successfully implementing a layo� or reduction in force (RIF) is one of the more di�cult change initiatives an HR professional

may face. Tasks HR professionals will need to undertake include:

Planning thoroughly. Each step in the process requires careful planning, considering alternatives, selecting employees

to be laid o�, communicating the layo� decision, handling layo� documentation and dealing with post-layo�

considerations.

Applying diversity concepts. HR should form a diverse team to de�ne layo� criteria and make layo� selections.

Addressing the needs of the laid-o�. This step involves reviewing severance policies, outplacement bene�ts,

unemployment eligibility and reference policies.

Dealing with the emotional impact. HR professionals should understand and prepare for the emotional impact of

layo�s on the downsized employees and their families, on the managers making layo� decisions, on other HR

professionals involved, and on remaining employees and managers working with the post-layo� workforce. In some

situations, an HR professional may even be responsible for implementing his or her own layo�, a case calling for the

utmost in professional behavior.

Managing the post-layo� workforce.

See Managing Downsizing by Means of Layo�s (www.shrm.org/ResourcesAndTools/tools-and-

samples/toolkits/Pages/managingdownsizing.aspx) and Drive Team Performance Using Organizational Transformation

(www.shrm.org/resourcesandtools/hr-topics/organizational-and-employee-development/pages/drive-team-performance-using-

organizational-transformation.aspx)

Bankruptcy

Filing for a business bankruptcy and successfully emerging from the process is generally a complex and di�cult time for all

parties. HR may have to cut sta�, reduce bene�ts, change work rules or employ a combination of such actions. A major strategic

concern during a Chapter 11 bankruptcy is retaining key personnel.

Compassion, frequent communication and expeditious decision-making will help reduce the stress an organization’s employees

are likely to experience during this di�cult organizational change. Showing genuine respect for people and treating them with

honesty, dignity and fairness—even as di�cult decisions are being made about pay, bene�ts and job reductions—will drive the

success or failure of an organization post-bankruptcy. See Managing Human Resources for a Company in Bankruptcy

(www.shrm.org/ResourcesAndTools/tools-and-samples/toolkits/Pages/companyinbankruptcy.aspx).

Closing a business operation

Businesses make the di�cult decision to close all or part of their operations for many reasons, including economic recession,

market decline, bankruptcy, sale, a realignment of operations, downsizing, reorganization, outsourcing or loss of contracts.

HR professionals will play an integral role during such business closures, from developing the plan for the closure through the

�nal stages of shutdown. Some of HR’s major responsibilities during this type of organizational change are listed below:

Following facility-closing noti�cation laws. HR must determine whether and to what extent the business must comply

with noti�cation requirements under federal or state laws for mass layo� and facility closings. HR will also lead the

announcement process and participate in all aspects of employee communications, which may include all-employee

meetings, written announcements and media interviews.

https://www.shrm.org/ResourcesAndTools/tools-and-samples/toolkits/Pages/managingdownsizing.aspx

https://www.shrm.org/resourcesandtools/hr-topics/organizational-and-employee-development/pages/drive-team-performance-using-organizational-transformation.aspx

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Announcing the closure news. HR has an important role to play in anticipating and responding to workforce reactions

by having as much information and resources on hand as possible. To avoid hostilities or other destructive behavior, HR

should consider using an employee assistance program or an outplacement �rm.

Providing employee bene�ts information. After the shock of the announcement subsides, the most frequently asked

questions involve bene�ts, including unemployment compensation, health care continuation, pension plan issues, and

retirement plan distributions and rollovers.

Coordinating outplacement services. O�ering outplacement services for departing employees may enable business

owners and managers to provide much-needed support and protect the organization’s reputation. If �nancially feasible,

the organization may o�er departing employees outplacement services from a private outplacement consulting �rm or,

in some states, a state agency.

Negotiating with unions. In unionized facilities, employers have a duty to bargain about the e�ects of a business

closure decision. These negotiations typically involve assistance bene�ts, seniority issues, pension plan issues and

employment opportunities at facilities not a�ected by the closure.

Costing the closure. Anticipating the costs of a business closure is critical from an early stage of the process and will

fall heavily on HR. This procedure involves assessing the cost of winding down employee bene�ts, assistance bene�ts,

payroll and administrative costs, severance payments, union demands, unresolved employee claims or charges, security

precautions, and any closing noti�cation penalties.

Disposing of company property. HR should know the organization’s policy for disposal of company property and

respond to employees’ requests for o�ce furniture, equipment, machinery and other tangible business assets. If the

business does not sell or transfer assets or is not in debt to creditors, HR may help determine whether to give items to

employees, community groups, schools or other potential recipients.

Complying with legal requirements. Numerous legal issues surround the closing of a business. Depending on the

number of employees and the employer’s commitments to employee bene�ts programs, legal compliance may require

following closing-noti�cation requirements, sending out COBRA notices and termination letters, issuing �nal paychecks,

making any required severance payments and communicating unemployment compensation. HR must know how to

comply with the laws and avoid litigation risks.

Outsourcing

For several reasons, including cost savings and freeing sta� to focus on more strategic e�orts, an organization may decide to

outsource HR or other business functions. Outsourcing is a contractual agreement between an employer and a third-party

provider whereby the employer transfers the management of and responsibility for certain organizational functions to the

external provider. Many types of outsourcing options are available to employers, from outsourcing one aspect of a single

function to outsourcing an entire functional department. This change can have a similar impact on employees as downsizing or

closing a department.

When deciding whether to outsource, an organization should carefully consider questions about its needs in a particular

functional area, current processes, business plan and outsourcing options, including:

Does the situation merit outsourcing?

Is the department providing excellent service with existing sta� and processes? Is it meeting the organization’s needs?

Can the a�ected department handle outsourcing without disrupting operations?

Will the CEO and top management team support and pay for an outside vendor?

How might an outsourcing arrangement fall short of expectations? How can such risks be mitigated?

2021/1/28 Managing Organizational Change

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During an HR outsourcing process, HR professionals may be asked to identify solutions to guide organizations through vendor

selection and management of the outsourcing relationship. See Outsourcing the HR Function

(www.shrm.org/ResourcesAndTools/tools-and-samples/toolkits/Pages/outsourcingthehrfunction.aspx).

Changes within HR

HR professionals frequently help other parts of the organization respond to change, but what happens when the HR

department becomes the epicenter of change? These kinds of transformations, such as moving to a shared services model,

integrating with another HR function following a merger or delivering new services to new clients, can be more di�cult for HR

professionals to manage than other types of organizational changes.

During major changes within the HR function, HR should do the following:

Lead by example. Do exactly what HR asks other leaders and managers to do during major change initiatives.

Remember that HR professionals’ responsibilities never cease. The HR department must continue to serve employees

while contending with the discomfort, confusion and demands that department-speci�c change creates.

Keep in mind that few organizational changes occur in isolation. If senior leaders decide to implement an HR shared

services model, for instance, the information technology, �nance and procurement functions also could move to a

similar model or initiating e�ciency projects.

Measure the degree to which HR sta� is prepared to change before plunging into the change. HR leaders should

assess sta� readiness and engagement through interviews and surveys. After evaluating the results, they should make

necessary adjustments in sta� readiness and engagement levels before proceeding.

Realize that most HR transformations require fresh, or refreshed, talent. HR leaders can �re and hire, or they can

retrain and develop.

Legal Issues

In addition to managing the “people side” of organizational change initiatives, HR professionals should keep leadership

informed of any applicable employment laws and the potential legal implications of various types of change. Typically, HR will

be responsible, in consultation with legal counsel, for ensuring compliance with pertinent federal, state, local and international

employment laws and regulations.

Legal compliance requirements may vary considerably based on the nature of the change initiative, the location(s) and size of

the organization, whether the employer is unionized, and other factors. Federal laws that may apply to particular organizational

change initiatives include:

Title VII of the Civil Rights Act of 1964.

Age Discrimination in Employment Act (ADEA).

Americans with Disabilities Act (ADA).

National Labor Relations Act (NLRA).

Worker Adjustment and Retraining Noti�cation Act (WARN) of 1988.

Employee Retirement Income Security Act (ERISA).

Health Insurance Portability and Accountability Act (HIPAA) of 1996.

Consolidated Omnibus Budget Reconciliation Act (COBRA).

See Federal Statutes, Regulations and Guidance (www.shrm.org/ResourcesAndTools/legal-and-compliance/employment-

law/pages/federal-statutes-regulations-and-guidance.aspx).

https://www.shrm.org/ResourcesAndTools/tools-and-samples/toolkits/Pages/outsourcingthehrfunction.aspx

https://www.shrm.org/ResourcesAndTools/legal-and-compliance/employment-law/pages/federal-statutes-regulations-and-guidance.aspx

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HR professionals may also be responsible for negotiating contracts with unions, service providers or vendors. In such cases,

they need to be familiar with key contract terms and issues and be able to represent the organization’s interests e�ectively in

contract negotiations and management. See Conducting E�ective Business Negotiations

(www.shrm.org/ResourcesAndTools/tools-and-samples/toolkits/pages/conductinge�ectivebusinessnegotiations.aspx).

Global Issues

Signi�cant organizational changes can create ongoing con�ict between two locations in the same country. But con�ict is more

likely to occur, and is harder to address, when di�erences in language, time zones, institutions and business practices exist.

According to research conducted by the Economist Intelligence Unit, companies will continue to become larger and more

global, handling operations in more countries than they do today.

Culturally based assumptions about customer needs, infrastructure, competitive threats and other factors make it more di�cult

to �nd common ground during a cross-cultural change initiative. What di�erentiates an organization’s products or services in

one country may not be the same elsewhere, and the strengths that it has in its home market may not be easily replicated in

other countries.

Common problems in cross-cultural change initiatives include:

Lack of a partnership approach. It is natural for an organization to consider its home market and its largest customers

when planning change e�orts. However, those voices can easily drown out the needs of employees or clients in distant

markets, including those that could have high growth potential. By partnering with all employees and clients from the

beginning and considering future potential for revenue, pro�t and growth, an organization can build an approach to

change that integrates the patterns of past successes with future directions.

Misreading similarities and di�erences in markets. Multinational organizations might project solutions suitable for one

country onto another country or assume that customers abroad want to behave “more like us.” To make matters more

complicated, foreign products may have considerable appeal in some markets but often for reasons that only make

sense in the local context. Companies may expect the same competitive landscape, yet the largest competitive threats

may come from companies that are unknown back at headquarters.

Not enough accountability. Establishing accountability at the local level is di�cult when employees lack a sense of

ownership for a new initiative. This situation can be exacerbated by the typical matrix organizational structure at many

global companies. Employees who report into both a global business unit and a local management structure frequently

pay the closest attention to the managers they encounter every day who are most likely to a�ect their futures.

Leaders of global change initiatives should consider these potential problems and plan to address them in advance. They will

be far more likely to avoid change-related pitfalls; achieve their objectives; and build business partnerships characterized by

mutual learning and superior business results.

Endnotes

Gartner. (2018). Change Management. Retrieved from https://www.gartner.com/en/insights/change-management

(https://www.gartner.com/en/insights/change-management)

Willis Towers Watson. (2013, August 29). Only one-quarter of employers are sustaining gains from change management

initiatives, Towers Watson survey �nds. Retrieved from https://www.towerswatson.com/en/Press/2013/08/Only-One-Quarter-of-

Employers-Are-Sustaining-Gains-From-Change-Management (https://www.towerswatson.com/en/Press/2013/08/Only-One-

Quarter-of-Employers-Are-Sustaining-Gains-From-Change-Management)

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2

https://www.shrm.org/ResourcesAndTools/tools-and-samples/toolkits/pages/conductingeffectivebusinessnegotiations.aspx

https://www.gartner.com/en/insights/change-management

https://www.towerswatson.com/en/Press/2013/08/Only-One-Quarter-of-Employers-Are-Sustaining-Gains-From-Change-Management

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(7476)

SHRM provides content as a service to its readers and members. It does not o�er legal advice, and cannot guarantee the accuracy or

suitability of its content for a particular purpose.

Disclaimer (www.shrm.org/about-shrm/Pages/Terms-of-Use.aspx#Disclaimer)

Kotter, John. (2014). Accelerate: Building strategic agility for a faster-moving world. Boston, MA: Harvard Business Review

Press.

Economist Intelligence Unit. (2010). Global �rms in 2020: The next decade of change for organisations and workers. Retrieved

from https://www.shrm.org/hr-today/trends-and-forecasting/research-and-surveys/Documents/10-Economist%20Research%20-

%20Global%20Firms%20in%202020 (www.shrm.org/hr-today/trends-and-forecasting/research-and-surveys/Documents/10-

Economist%20Research%20-%20Global%20Firms%20in%202020 )

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2021/1/28 Generating tensions: A multilevel, process analysis of organizational change – Alexia Panayiotou, Linda L Putnam, George Kassinis, 2019

https://journals.sagepub.com/doi/full/10.1177/1476127017734446 1/37

Strategic Organization

First Published November 21, 2017 Research Article
https://doi.org/10.1177/1476127017734446

Abstract
Working within a Bakhtinian perspective of relational dialectical tensions, this study seeks
to elaborate on current organizational change theories through a rich set of qualitative
data collected on an Internet start-up that revolutionized the music industry. Following the
company for 12 years, we focused on the tensions arising during the company’s
development and on the responses to these tensions. Our results indicate that with a
process model, tensions and decisions develop in a reflexive relationship, which shows
that change happens, not in spite of unintended consequences, but because of the
unintended consequences of the decisions enacted. We show that change is not always
the result of deliberate intentions, conscious choices, and purposeful actions of
individuals, but rather as an ongoing process that evolves through countervailing
dynamics at multiple organizational levels. Tensions and responses to them are pivotal to
this process of changing and should be analyzed as directional markers for future
oppositional struggles. Consistent with the Bakhtinian position, we find that change occurs
within the interplay of tensions as actors live out struggles and decisions in the midst of
organizing.

Generating tensions: A multilevel, process analysis of
organizational change
Alexia Panayiotou, Linda L Putnam, George Kassinis

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Keywords

organizational change, process orientation, dialectical tensions, contradictions,
unintended consequences, creative industry

Since the early work on systems theory, tensions and contradictions have been a vital part
of the organizational change landscape (Quinn and Cameron, 1988). As new forms of
organizing often clash with traditional practices, tensions are everyday occurrences in
organizational change, especially in light of globalization, new technologies, and niche
markets (Ashcraft and Trethewey, 2004). Indeed, both scholars and practitioners often
question what stability means in an era of continual change (Farjoun, 2010).

Extensive research in organizational studies focuses on the development and
management of tensions, contradictions, dialectics, and paradoxes in organizational
change, specifically, how contradictions evolve over time, how actors respond to them,
and how these actions and reactions play out in the change process (for extensive
reviews, see Putnam et al., 2016; Schad et al., 2016). Even though scholars acknowledge
the role of change in crossing multiple organizational levels, research typically centers on
a particular arena, for example, institutional (Das and Teng, 2000), organization-wide
(Klarner and Raisch, 2013), or intraorganizational levels (e.g. top, middle, and lower
organizational levels) (Meyer, 2006). In this way, organizational level typically functions as
a backdrop or context that remains constant and removed from actors’ experiences rather
than as continually changing through ongoing events that link micro-level decisions to
meso–macro-level actions.

Even when scholars problematize tensions and organizational levels, they often embrace
equilibrium views of change in which they strive to reach a balance between opposites.
This bias results in splitting tensions across levels or oscillating between them. Also,
research typically presumes that boundaries across levels remain stationary during
changes. Thus, we raise the following questions: do boundaries across levels remain
distinct and static during organizational changes or do they move as actions from one
level reflect back on and shape future actions? How fluid are boundaries when tensions
and unintended consequences of change infuse multiple levels (MacKay and Chia,
2013)? In effect, this study seeks to extend the work on organizational change through
examining levels as dynamic contexts and questioning the rigidity of boundaries that
demarcate micro-, meso-, and macro-levels.

https://journals.sagepub.com/keyword/Organizational+Change

https://journals.sagepub.com/keyword/Process+Orientation

https://journals.sagepub.com/keyword/Dialectical+Tensions

https://journals.sagepub.com/keyword/Contradictions

https://journals.sagepub.com/keyword/Unintended+Consequences

https://journals.sagepub.com/keyword/Creative+Industry

2021/1/28 Generating tensions: A multilevel, process analysis of organizational change – Alexia Panayiotou, Linda L Putnam, George Kassinis, 2019

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In addition, this study problematizes the traditional relationship between tensions and
unintended consequences. Unintended consequences are typically defined as
occurrences that actors neither expect nor prefer (De Cock and Rickards, 1996). Scholars
who examine oppositional tensions and organizational change often view unintended
consequences as negative outcomes that cause side effects, problems, and unwanted
circumstances (Jian, 2007). Unintended consequences are also treated as problematic
because competent managers and change agents have difficulty accounting for and
controlling them (Harris and Ogbonna, 2002). This lack of control is especially evident
when tensions and changes play out in complex ways across multiple organizational
levels.

Within a process orientation, however, unintended consequences accompany change and
emerge as part of it rather than as controlled by agents or caused by environmental forces
that impinge on change (MacKay and Chia, 2013). This approach leads us to question,
how do unintended consequences grow out of tensions and relate to continual change
across organizational levels? Thus, this study makes a second major contribution in
showing how unintended consequences occur concomitantly with change and often
generate tensions that contribute to ongoing change.

Moreover, this study adds to the existing literature by adopting an alternative theory of
oppositional tensions, specifically Bakhtin’s (1981) relational view of dialectics that treats
opposites as rooted in discursive interactions linked to organizational decisions. Tensions
refer to stress, discomfort, and tightness from having to make choices among ongoing
struggles (Fairhurst and Putnam, 2014). In Bakhtin’s view, managing tensions emerges
from responses to them or ways that actors moved forward in the midst of a never-ending
process of engagement (Jabri, 2016). Hence, another contribution of this study stems
from employing relational dialectics to examine tensions, unintended consequences, and
change.

This study also adds to the growing body of literature on the creative industries (Caves,
2000), especially through a rich set of qualitative data linked to an Internet start-up
company that revolutionized the music industry, Sonicbids (https://www.sonicbids.com).
Having privileged access to this organization from its inception through a period of 12
years, this research focuses on how change happens “on the ground,” as well as in the
meso- and macro-dynamics of changing. Our unique longitudinal study conducted on
three levels—the founder of the organization (micro), the company (meso), and the
industry (macro)—allows us to take a process perspective in exploring tensions and

https://www.sonicbids.com/

2021/1/28 Generating tensions: A multilevel, process analysis of organizational change – Alexia Panayiotou, Linda L Putnam, George Kassinis, 2019

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responses to them during various periods of the company’s development (Langley and
Tsoukas, 2010).

To develop these contributions, we review the literature on process studies of tensions,
dialectics, paradoxes, and organizational change in two areas: multiple levels of analysis
and unintended consequences. We then describe the tenets of relational dialectics,
distinguish it from Hegelian dialectics and paradox theory, and justify selecting this
approach. We continue with our case study and analysis and conclude with the
implications of this study.

Literature review and theoretical perspectives

A process orientation to organizational change highlights streams of actions and
interactions that unfold over time as organizations are becoming (Langley and Tsoukas,
2017). Change is defined as the “reweaving of actors’ webs of beliefs and habits of action
as a result of new experiences obtained through interaction” (Tsoukas and Chia, 2002:
570). This study adopts a relational ontology that treats organizations not as things, but as
interrelated experiences that connect ongoing events. Change is not something that
happens to pre-existing organizations; rather, it constitutes organizations through the
unfolding chains of activities in which contexts are also evolving. This view of change,
particularly when intertwined with the growth of research on paradox and dialectical
tensions (Langley et al., 2013), problematizes multiple organizational levels and
unintended consequences.

Multiple organizational levels

Putnam et al. (2016) observe that process studies of tensions and organizational change
embrace multiple perspectives (Farjoun, 2010; Groleau et al., 2011; Seo and Creed,
2002). Dialectics and paradox theory are two commonly used approaches (for a
comparison, see Farjoun, 2017). Drawn from Hegel (1969), dialectics is defined as the
unity of opposites or the push–pull of contradictions in the ongoing development of social
systems (Benson, 1977). Cast as a particular type of generative mechanism, dialectics
represents an alternative to life-cycle theory, teleological models, and evolutionary
approaches that accent environmental causes and institutional survival (Van de Ven and
Poole, 1995). Dialectics in the Hegelian tradition situates change as arising from the
struggle between a thesis and antithesis that leads to a rupture, conflict, or transformation,
often resulting in a new thesis in which the process recurs (Van de Ven and Poole, 1995).

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In effect, this approach works from a determinant end point in which a struggle resolves,
culminates, or transforms (Hargrave and Van de Ven, 2017).

Research that employs Hegelian dialectics typically examines macro-level strategic
change, such as alliances (Das and Kumar, 2010; Das and Teng, 2000),
interorganizational collaborations (Johansson and Stohl, 2012), and institutional
entrepreneurship (Seo and Creed, 2002); but some studies focus on contradictions across
organizational levels. Drawing on a case study of an alliance, De Rond and Bouchikhi
(2004) show how four pairs of contradictions infuse individual, organization, and
collaborative levels at different stages that move from inception to termination. In a
collaboration that crosses urban and rural hospitals, Cho et al. (2007) target team,
organizational, and institutional levels to analyze contradictory forces in implementing a
telehealth innovation. Framed at the institutional level as business versus medical
interests, contradictions surface at the team level between workable and non-workable
practices. These choices shape the organization-wide tensions of adequate versus
inadequate reimbursement systems and acceptable versus unacceptable business plans
that reflect back on revenue loss and gain. Failure of the innovation raises questions
about how actors manage tensions that infuse different organizational levels.

Scholars who adopt structuration and activity systems perspectives center on change at
the individual, team, organizational, and institutional levels. In particular, research on
hospitals in an era of managed care shows how the ongoing process of change generates
contradictions that infuse multiple supervisory, organizational, and institutional systems
(Nicotera and Clinkscales, 2010). Primary contradictions in cost containment often
engender secondary ones in developing useful practices (Engeström and Sannino, 2011).
While these studies demonstrate how contradictions that cross multiple organizational
levels develop into paradoxes and double binds (Cho et al., 2007), they often align
oppositions with a fixed social context, such as capitalism or cost-related structures that
treat tensions as detrimental to organizational change (Das and Teng, 2000). As De Rond
and Bouchikhi (2004) note, contradictions are neither functional nor dysfunctional; they
just exist. Moreover, some studies, particularly at the institutional level, fail to capture the
lived experiences of individuals, such as emotional overload, burnout, and cynicism, thus
ignoring a pivotal level of analysis in understanding contradictions in process theories of
becoming (Doyle et al., 2000).

Finally, the work on paradoxes casts contradictions as opposites that exist simultaneously,
persist over a period of time, and create situations of almost impossible choice (Smith and
Lewis, 2011). Focusing on sensemaking as an effort to create an orderly understanding,

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Lüscher and Lewis (2008) examine paradox as a lens for new insights about mixed
messages during organizational change, ones that travel across organizational levels.
Tracking the paradoxes of performing, belonging, and organizing, they show how the
move from either-or thinking to both-and approaches enables reflection through
paradoxical inquiry. This study, however, while sensitive to the grounded actions and
interactions of paradoxes, treats organizational levels as fixed arenas or static contexts
without deciphering their reflexive interrelationships.

In contrast, in a study of product implementations over a 3-year period, Jarzabkowski et
al. (2013) demonstrate how interactions between micro- and meso-paradoxes (i.e.
performing and belonging) spur specific actions embedded in restructuring that reflect
back on the macro-level paradox. In a similar way, Haddadj (2006) reports how the
simultaneous enactment of complex versus simple processes and stable versus unstable
business arrangements trigger paradoxes in a CEO transition that influence the planning
and restructuring of a family firm. With a similar reflexive lens for tracking paradoxes, Jay
(2013) employs a sensemaking approach to examine how participants navigate
paradoxes triggered by ambiguity in institutional logics that surface in a public–private
hybrid organization. Unlike many organizational and institutional change projects, these
studies serve as models for examining how contradictions reflexively fuel organizational
change across multiple phases and iterations. Yet, they do not focus on the role of
unintended consequences or on the fluid nature of boundaries that typify these
organizational levels.

Moreover, despite differences among these perspectives, the majority of studies share a
bias for balancing opposing forces or restoring equilibrium to organizational change. This
bias, as De Rond and Bouchikhi (2004) point out, implicitly treats change and tension
management as successful or unsuccessful. Contradictions and paradoxes surface as
needing to be managed, seeking a “workable certainty,” or assigning opposites to different
levels or time periods. This view implicitly favors a dynamic equilibrium as a means of
balancing opposites (Smith and Lewis, 2011).

In general, the studies on tensions, dialectics, and paradoxes that examine multiple levels
often align levels with a fixed view of context, have a bias for restoring equilibrium in
managing tensions, and treat boundaries between levels as pre-set and static. These
concerns lead to the following research question:

RQ1: How do organizational contexts and boundaries change as organizations are in
the act of changing?

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Unintended consequences

Related to a multilevel focus on organizational change, unintended consequences are
outcomes that actors neither expect nor prefer (Harris and Ogbonna, 2002; Jian, 2007),
while unanticipated consequences are often opposite outcomes of what was initially
desired (McKinley and Scherer, 2000). Both types of effects are pivotal to change, yet
process studies of organizational tensions typically treat them as negative. Moreover, they
adopt the view that managers should control for these unanticipated side effects, as is
evident in studies of the financial performance of a Total Quality Management (TQM)
program (Sterman et al., 1997); organizational change that benefits adversaries rather
than empowered actors (Asiskovitch, 2009); and ways that actors monitor, measure, and
account for unintended consequences (Cortell and Peterson, 2001).

Yet, “unanticipated” is not necessarily “undesirable” (Merton, 1936), and sensemaking
practices as well as findings on the indeterminacy of choice challenge the view that
unintended consequences can be controlled (Balogun and Johnson, 2005). In fact, both
intended and unintended circumstances arise from collective sensemaking that often
result in resistance and rejection of changes. As Jian (2007) notes, “planners (should)
understand that although paradoxical, indeterminacy is the nature of planned
organizational change” (p. 25). Studies that examine multiple organizational levels confirm
this view of indeterminacy, particularly in discovering unintended consequences that
emerge on one level and displace actions on another level (Abdallah et al., 2011);
successive downsizings in which unintended consequences and contradictions from one
stage set the conditions for future reductions in force (Fairhurst et al., 2002); and
increased exploration at one organizational level backfires and diminishes performance at
other levels (Siggelkow and Rivkin, 2006).

In effect, most of the literature treats unintended consequences as an unwanted
organizational side effect that needs to be controlled. Researchers rarely center on how
unintended consequences might actually fuel ongoing change as actors generate and
respond to tensions. In contrast, the “unowned view” elevates chance and uncertainty and
treats unintended consequences as driving ongoing change (MacKay and Chia, 2013).
Rather than embracing strategic choice or environmental determinism, the unowned view
adopts the position that actors, organizations, and environments are “temporary” and, as
such, offer partial or incomplete understanding of uncertainty in change situations; thus,
unintended consequences arise “of [their] own volition” from coping actions and without
the need for an identifiable change agent (MacKay and Chia, 2013: 211). Even though
managers act purposively, the “unowned view” contends that they cannot anticipate,

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control, or account for unintended consequences because their choices are incomplete
and temporary. In effect, every choice made or every deliberate action taken in a change
situation is necessarily partial. Unintended consequences then emerge on their own from
actions linked to coping with changes. As these consequences infuse or cross
organizational levels, they may fuel tensions and subsequent changes. This stance leads
to the following research question:

RQ2: How do unintended consequences surface in tensions and organizational
change?

Relational dialectics and organizational change

Research on tensions and organizational change typically embraces Hegelian dialectics
or paradox theory. As an alternative, this study adopts relational dialectics, an approach
drawn from Bakhtin (1981) whose work focuses on dialectics and dialogue in literature.
Treating discourse as a cultural product, Bakhtin (1981) examines how language
constructs reality through ongoing struggles over actions and meanings. Discourse serves
as a system of meaning, one that references the past, provides interpretations of the
present, and anticipates the future; hence, meanings are never fixed and are always in
play. Relational dialectics focuses specifically on tensions that become centered or pivotal
in action (centripetal forces) and interact with those that surface as marginalized or form
division (centrifugal forces) (Baxter and Montgomery, 1996). Responses to tensions play a
pivotal role in reconstructing social arrangements through shifting interests and altering
opportunities to act (Baxter, 2011).

Importantly, then, a key feature of relational dialectics is deciphering how actors respond
amid struggles. “Responding,” however, differs from the normative approach of “managing
tensions” in that responses become part of an ongoing struggle over action and meaning
and the temporal flow of change. Putnam et al. (2016) set forth three categories of
responses: (1) either-or, that is, privileging one pole over the other through selection,
denial of tensions, dividing and separating them, or employing defensive mechanisms; (2)
both-and, that is, embracing tensions in paradoxical thinking, moving back and forth
between tensions at different times or on different organizational levels, or finding a
balance or a compromise between them; and (3) more-than, that is, continually
connecting the tensions, situating them in a new relationship, or reformulating the tensions
into a new whole through reframing, transcendence, and promoting relational reflexivity
through increased consciousness. Research reveals that both-and and more-than
responses aid in embracing tensions and moving forward in creative ways, rather than
feeling paralyzed or experiencing inaction (Schad et al., 2016).

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Another type of more-than response, drawn from Bakhtin (1981), centers on developing a
third element through using dialogic activity to connect dualities, alter the boundaries of
opposites, and create a third space (Janssens and Steyaert, 1999). Dialogic activity is a
process which moves dialectics to dialogue through adding more voices to the interplay of
tensions or introducing unrecognized perspectives in the struggle over meaning. The third
element is also called a “zone of ambiguity,” a “development zone,” or “space for
creativity” in the midst of tensions (Berglund and Werr, 2000).

Initially developed to study how interpersonal relationships evolve, maintain, or
deteriorate, scholars employ relational dialectics to examine a number of topics, including
inclusion–exclusion tensions in planned organizational change (Barge et al., 2008),
internal–external tensions in interorganizational collaborations (Lewis et al., 2010), and
exploration–exploitation tensions in innovation (Sheep et al., 2017).

A few studies examine tensions across multiple levels. In a study of a global software
company, Gibbs (2009) focuses on tensions across group member, inter-team, and team-
organizational levels through the use of relational dialectics. Her study reveals that lower
level employees respond to tensions through employing either-or approaches (i.e.
withdrawal and selection) and members of inter-team and team-organizational levels
embrace both-and responses (i.e. transcendence and reframing). In a different study of
managed care, Medved et al. (2001) identify five types of tensions that cross
organizational levels, for example, sharing versus guarding information between leaders
and external stakeholders, short-term local projects struggling with long-term global
issues, and linear or stage models of global planning in tension with experiences at the
local level. Responses to tensions reveal that linear, incremental models fail to capture
ongoing changes that move forward, backward, dissolve, and then reorganize.

Relational dialectics is particularly suitable for this study because it is grounded in a
relational ontology, focuses on micro-practices of actions and interactions, and uses
discursive practices to understand struggles over meanings. It differs from paradox theory
in that it focuses on how tensions are constituted; that is, how they come into being
through interaction processes that evolve over time. Thus, it examines the ongoing
interplay of tensions as they emerge rather than locating tensions in sensemaking,
cognitions, and psychological states. Relational dialectics also moves away from
equilibrium as an end point for managing paradoxes. Instead, it treats tensions in
organizational change as an ongoing interplay between order and disorder with no
predetermined end state.

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Unlike Hegelian approaches, relational dialectics locates contradictions and tensions in
everyday decisions and interactions; thus, it moves away from structures, systems, and
institutions. It also differs from Hegelian thinking through rejecting a determinant end point,
ruptures, and conflicts as culminating processes. Bakhtin’s (1981) view of dialectics draws
from Marx’s (1906) notion of forces of unity and division and embraces a dialogical view of
dialectics. Specifically then, this study draws from Bakhtin’s (1981) concept of dialectics,
locates tensions in struggles over meaning, focuses on responses to them, and centers
on ways to connect them over time.

This theoretical lens shapes two key questions that guide our study:

RQ3: What types of tensions and what types of responses to them surface across
organizational levels during ongoing change?

RQ4: What patterns among tensions and responses emerge in relation to organization
levels?

The case

Sonicbids: an online marketplace for independent music artists and promoters

This case study took place at Sonicbids, an Internet-based company founded and
headquartered in Boston, Massachusetts, in 2001. Sonicbids used a state-of-the-art
online platform to directly connect thousands of talented and previously unnoticed
independent musicians with promoters who needed their talents. Basically, the company
connected independent artists with promoters of live music events who held licensing
opportunities (see Table 1 for a background summary of the music industry). According to
its website, Sonicbids “help[ed] bands discover and book gigs” by offering an easy-to-use-
online platform that allowed artists to create their Electronic Press Kits (EPKs) and apply
for gigs advertised on Sonicbids’ website. It also helped promoters book “the right bands”
(https://www.sonicbids.com, last accessed 15 May 2014).

Table 1. Timeline of the case organization and related data.

A Berklee College of Music graduate, the founder, Panos Panay, was an executive at a
major talent agency in the late 1990s when he realized that a large group of independent

https://www.sonicbids.com/

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artists, who were not popular or profitable enough for big talent agency standards, were
rarely considered for “gigs.” Fully nine-tenths of this US$15b market went unserved.
Agents received numerous hardcopy press kits that they often had little time to review
while artists anxiously waited for decisions on their submissions. Panay recalled the day
when he picked up a book called Blur: “The author contended that the wired world was
eliminating the lines between traditional business categories … once-separate, products
and services were blending on the Internet” (Champy, 2008). According to Panay, that
“nugget of knowledge” inspired him to developed the concept of Sonicbids to address the
challenges that he faced as an agent and perhaps to shape the future of the music
business. When his boss rejected his proposal, Panay quit his job, put together a
business plan, and launched Sonicbids as an online platform in 2001 with US$50,000 that
he raised from family and friends.

Contrary to the industry trend at that time which focused on artists as the main
stakeholders, Panay believed that the key to Sonicbids success was to go after the
promoters. If they bought into Sonicbids, the musicians would find their way. The simplicity
and efficiency of receiving and reviewing EPKs without searching through piles of
paperwork and listen to CDs, and to do so by getting paid for each submission, was
enough to get 102 promoters to sign up in the first year of operation and a total of 2600 by
the beginning of 2005 and around 21,000 by 2013. In addition, Panay found that
Sonicbids gained credibility by having the promoters pay the artists directly rather than
going through an agent. As expected, artists’ responses exceeded the number of
promoters’ sign-ups with the member artist community growing by over 500% between
2004 and 2007. With the live performance industry doubling in 10 years, Sonicbids
enjoyed significant growth year after year. The company, which employed about 50 “music
aficionados” at the end of 2009, generated approximately US$10m in revenue in 2010. Its
250,000 registered bands and 21,000 promoters from around the world sealed deals on
73,000 “gigs” in 2009.

In 2007, Sonicbids raised US$4.5m in institutional funding. Soon after, it launched the
Sonicbids Brands Division that used music to promote brand awareness of products and
services. By tapping into its community of artists, Sonicbids offered market segmentation,
customized websites, advertising, promotional events, among other services. In June
2010, Sonicbids announced its acquisition of ArtistData, a publishing platform that allowed
musicians to update and publish their content across multiple social networking sites.
Other partnerships, such as the one with online music retailer Musician’s Friend, made “no
fee submissions for gigs” available to Sonicbids members.

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Panay felt that artists needed to understand the environment in which they operated and
be actively involved with their own fan-base by participating in social media. Ultimately, he
envisioned “no starving artists but a strong artistic middle class.” As Champy (2008)
noted, the change brought about by Sonicbids facilitated a market that was increasingly in
need of “efficient and transparent ways of finding and booking independent bands” (p. 27).

Sonicbids received many prestigious business awards and listings, including ranking fifth
in the 2005 Fast Company’s “Fast Fifty” list and a 2006 ranking in Inc’s 500 fastest
growing US companies. The founder also received several awards, including Boston
Business Journal’s “40 Under 40” Award and the 2010 Massachusetts High Tech All-Stars
Award for Innovation.

Methods

The researchers gained access to the company through a personal relationship of one of
the authors with the founder. Although the initial work was to develop a teaching case, the
project evolved into a 12-year ethnographic study of organizational changing through
collecting real-time data from multiple observations; thus, we traced change as it was
happening “on the ground.”

Data collection

This study relied on a rich set of interview data collected between 2001 and 2012 in
conjunction with extensive ethnographic data. Data collection was guided by the need to
“construct a detailed story from raw data” (Langley, 1999) through aiming to act as what
Barley (1990) describes as a “human camera.” Following the work on organizational
ethnography (Kostera, 2007), we collected data through on-site visits, interviews,
participant observations, archival data (such as internal company documents, press
releases, websites, and news articles), and follow-up emails and phone conversations
from 2001 to 2012. During this time, one of the authors visited Sonicbids’ offices in Boston
three times—at the end of 2001, in June 2003, and in July 2008—while a hired research
associate also conducted visits in October 2010. In each visit, the researchers spent from
2 to 5 weeks in the office in which they conducted interviews, shadowed the founder, and

attended company strategy meetings, lunch breaks, “gigs”1 of Sonicbids bands, and other
events. Shadowing involved following the founder continuously in his daily workings
(Czarniawska, 2007).

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In March 2011, the research associate attended the big music event that Sonicbids
sponsored in Austin, Texas, known as “South by Southwest” in which she informally met
with the founder, staff, artists, and promoters. The founder and other members of the
leadership team were also interviewed off-site when one of the authors and the research
associate met them in a business location in Europe (August 2011). In addition, even
though the intensive data collection period ended in 2012, the researchers contacted the
founder and other interviewees several times through email and telephone to make
clarifications and follow up on issues that arose during the study. Table 1 presents a
general timeline of the case organization and the data produced (see also Mantere et al.,
2012).

We conducted 31 interviews at various stages of the data collection process, as shown in
Table 2. The interviews included the key stakeholders: founder, board members, and staff
at different levels of the company; artists (independent musicians) who had benefitted
from the company’s services; promoters (e.g. individuals who purchased musical talent,
for example, heads of music festivals; owners of clubs, bars, and casinos); and
shareholders who invested in the company. We included the artists and the promoters to
lay out our ethnographic terrain and get a complete picture of the company, one that
included clients. Specifically, we conducted six interviews with the founder, two members
of the board of directors, the chief financial officer (CFO), the vice president (VP) of
strategic programs, the marketing manager, and nine other staff members, as well as six
American artists who signed up with Sonicbids, two promoters, and three shareholders.

Table 2. Interview data used for this study.

Interviews were semi-structured and lasted between 20 and 120 minutes. All were
recorded and transcribed, except for the artists’ interviews which were not conducive to
formal techniques because they took place at music events. For these interviews, which
were also shorter (around 20 minutes), field notes were taken. In general, we used open-
ended questions that allowed informants to relate chronologies, events, and situations
(Mishler, 1986). Interview protocols largely focused on informants’ roles and relationships
to the company, changes in their roles over the years, Sonicbids’ main contributions to the
industry (we also clarified which industry), their own and the company’s main challenges,
the uniqueness of the company, and Sonicbids’ culture. Our official data collection ended

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in 2012 after the company’s resources were completely strained and the Board made the
strategic decision to sell the company.

Data analysis

The data analysis drew from a combination of strategies used in other longitudinal studies
of change (e.g. Langley, 1999; Mantere et al., 2012). It was conducted in three rounds that
progressed from a detailed reading of the data to greater generality, with the ultimate goal
to elaborate theory, as guided by similar studies in the field. To borrow a term from Pratt
(2009), the “protagonists” of our analysis were the tensions manifested across all levels of
change—individual, organizational, and industry.

The first step focused on a fine-grained reading of the data collected, including
ethnographic, archival, and interview transcripts (Mantere et al., 2012). Specifically, (1) we
sorted the data in three topical areas: (i) the founder’s story of creation, (ii) the company,
and (iii) the music industry. These three topic areas roughly corresponded to levels of
analysis: individual, organization, and industry-wide perspective. (2) Then, we wrote three
descriptive manuscripts—one on the changes that occurred in the last 12 years in the
industry, one on the changes in the company itself, and one on the founder (inevitably the
last two were deeply interconnected). (3) Next, we reorganized the data into three general
periods which roughly corresponded to the main tensions in Sonicbids’ development.
These periods were “simply a way of structuring the description of events” (Langley, 1999:
703) and should not be viewed as linear, sequential processes. This step was particularly
important for analyzing interview data since respondents freely discuss their experiences
and often jumped back and forth from past to future. Thus, we marked specific interview
quotes as “Period 1, Period 2, etc.” and rearranged them in designated periods that were
broadly named as “moving in non-traditional directions,” “developing ways to serve
struggling artists,” and “generating revenue to survive and expand.” The periods not only
represented changes but also aimed to capture the temporal flows of bringing the past
into the present and examining the present in anticipation of the future.

At this stage, we noticed that each period was marked by specific questions and tensions
that crossed the three levels of analysis. Therefore, we returned to the data for each
period to look for possible patterns. We began by searching for a possible “driving
question” in each period. In Period 1, for example, we found that the major concern was
“Who are the main stakeholders?” and by extension, “Who should Sonicbids focus on
first?” The driving question for each period revealed different oppositional struggles,
tensions, and sub-tensions for the three levels of analysis. Then, we traced how tensions
surfaced in the language used and clustered them into categories of similar tensions

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(which were in turn tied to the overall question for a given period). Actors often signal
tension with emotional language (“frustrated,” “torn,” “anxiety”), dilemmas (marked by “I
don’t understand,” “not sure,” “question,” “decision”), dualisms (“either,” “or,” “choice”), or
strong words (“had to step down,” “crazy,” “cost,” “accused,” “challenge”) (Fairhurst and
Putnam, 2017). Examples of quotes indicating tensions are shown in Appendix 1.

In the next step, we grouped the tensions across the three levels and the three periods
(Figure 1 and Appendix 1); that is, for each period, we named the individual,
organizational, and industry tensions noted under specific subheadings. Subsequently,
guided by the literature (e.g. Jarzabkowski et al., 2013), we categorized the responses to
these tensions; these refer broadly to different ways of reacting to tensions, dealing with
them, or moving on—not necessarily resolving them. Our categories parallel the three
broad responses in relational dialectics: either-or, both-and, and more-than (Putnam et al.,
2016). To “name” a particular response, we questioned how organizational members
treated the opposite poles, what actions they took to situate them in relation to each other,
and how these actions changed in the flow of time. For either-or responses, we looked for
evidence in the language or actions that supported a preference for one pole or ignoring
the existence of the other one. For both-and responses, we looked for displays that
indicated actors were oscillating between the two poles, in pursuit of an equilibrium,
compromise, or neutralization; in other words, we located markers that indicated ways that
actors bridged or attempted to balance competing goals. For more-than responses, we
looked for signs of “reframing” the opposition or ways that the actors crafted a “third
space” out of a contradiction.

Figure 1. Tensions, responses, and unintended consequences in change processes at Sonicbids.

Finally, for each period, we searched for any unintended effects, surprises, or
unpredictable actions that surfaced from decisions taken in response to the driving

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question. We focused on shock elements in the change process and effects that were not
anticipated. To track these unintended consequences, we relied not only on the interviews
but also on the supplementary ethnographic data that we had collected. Appendix 1
shows exemplar interview quotations of tensions and responses across the three levels
for all three periods. The last column groups the unintended consequences per period.

The tensions of change

To conduct a multilevel, processual analysis of change at Sonicbids, we focus on three
key periods that represented turning points or shifts in the company’s direction. As noted
in our methods section, the three periods are: (1) moving in non-traditional directions, (2)
developing ways to serve “the artistic middle class,” and (3) generating revenue to survive
and expand. In each of these periods, we examine the tensions and responses to them for
three levels of analysis: (1) individual-organizational, (2) organizational-stakeholder, and
(3) industry-wide.

Period 1: moving in non-traditional directions

We noted in the case presentation and the event history of Table 1 that Sonicbids was
founded during the “digital revolution” (Kusek and Leonhard, 2005) and capitalized on the
wider social changes of the late 1990s which altered the ways that people shopped,
searched for information, or read books. At this time, the Internet introduced a type of
“democratization” that allowed artists of all types to access different audiences in ways
never envisioned (Kot, 2009). In the music industry, a rise in digital sales alongside a
sharp decline in record sales was egging artists toward live performances.

Although these wider changes could be seen as paving the way for an online music
marketplace, the micro-changes induced by an individual who grasped the potential
opportunities for “struggling artists” were important. By questioning the traditional
musician-agent-promoter relationship, the founder of Sonicbids developed a new way of
doing business that ultimately transferred power to a complex network of actors which, in
turn, changed the industry. In this sense, change is more of a co-evolving process in
which contexts were changing as the organizations were changing. Of course, in an
interview in 2001 he noted, “questioning never comes without a price” so soon after he
launched Sonicbids, he had to deal with the first set of tensions.

Individual-organizational tensions and responses

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Micro-changes often occur through individual actions and interactions, particularly in
providing leadership for an organization. In this case, the founder saw an opportunity: as
he said, “I was an agent for years before I started Sonicbids … unless somebody made
3,000 a night we couldn’t take them on … So I thought, well where is everybody else
going?” Noting an inspiration from the book Blur, he thought that focusing on the millions
of “little guys” in the music industry (versus the elite players) could be a breakthrough. His
idea was met with a lot of skepticism both from music industry experts and team members
who wondered how “marginalizing the elite would impact (Sonicbids’) reputation”
(interview with Panay, 2001). The founder used words and phrases such as “struggled,”
“worried,” and “questioning comes with a price” to show the tension surrounding his
proposal to move in non-traditional versus traditional directions.

Yet, the response to this tension was not to accept a binary either-or view of the
opposition; rather, the founder and his team enacted an integrated approach through
setting up a decentralized network of operations to counter the existing hierarchical model
of the agent–musician relationship (traditional approach). Rather than abandoning their
base, Sonicbids allowed both the “little guys” and “established elite” to take advantage of
their services. Through this action, Sonicbids became a type of “eBay for musicians”; that
is, artists of all types could sign onto the platform by paying a member fee, and people
looking to buy their talents (“promoters”) would be able to “bid” for them. This new
integrative model of finding a common ground between doing business in a non-traditional
way while also engaging the traditional elite, redefined the roles of musicians, agents, and
promoters through a complex decentralized network.

Organizational-stakeholder tensions

and responses

In launching this “eBay for musicians,” however, Sonicbids encountered a new tension:
should the company follow the accepted industry standard of focusing largely on artist
sign-ups or should it move in a non-traditional way by getting promoters on board first?
Some organizational members argued that to effectively “tap into an un-serviced market
they should break industry norms and engage promoters in an active way; then the artists
would follow” (interview with Panay, 2003). Yet, key staff members, including “old-timers”
of the music business, insisted that bands (artists) were the number 1 priority, not the
promoters, and that a plan that did not privilege artists would not be profitable.

In responding to these tensions, the Sonicbids management team, headed by the founder,
reframed the opposition of artists first versus promoters first and thus redefined the
relationship between these “poles.” Specifically, by focusing on “passive promoters,” the
new business model eliminated the lines between traditional business categories:

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promoters simply logged onto their Sonicbids accounts, saw a list of the different bands
that applied, reviewed them online, and notified them if they were interested. By charging
bands up to US$25 to apply (in the early 2000s), promoters were able to weed out the
artists who sent mass applications, and by reviewing EPKs online, they were able to
respond to artists quickly. “We make it easy for both sides,” the founder said (interview
with Panay, 2003). As predicted, once promoters joined, bands followed: “Once the first
promoter signed on, it was like getting your first credit card … others followed” (interview
with Panay, 2003). Therefore, by the end of Sonicbids’ first year, 102 promoters had
signed on.

By changing the sequencing of doing business, organizational members recast the two
poles that were initially in a dialectical struggle by subsuming them under a new business
model. It was no longer a question of “who do we go after first” but rather “how can these
two groups benefit from each other.” This more-than approach, championed through an
individual-organizational interplay of tensions, altered the context and the traditional music
business model. This change also shifted the boundaries and role distinctions between
promoters and artists.

Industry-wide tensions

and responses

The digital revolution introduced a wider set of changes in the music business as the
industry shifted away from selling records (until then, artists’ main source of income) to
live performances. Through the EPK, Sonicbids took advantage of the digital revolution
and promoted an alternative to the physical press kit—“better, faster, easier, and cheaper”
(interview with Panay, 2003). While artists seemed to be on board with the wider
contextual changes and industry shift from physical to digital, the more “traditional” side of
the business, the promoters, who were used to doing things a certain way, were not. This
issue was raised by staff who had been with the company since its early years—or as a
product manager, who had been with the company since 2003 aptly said, “When we were
only 12 people and fit in that little room down the street.” Experiencing the shift, these
members wondered how it would impact Sonicbids’ stakeholders: “Using the technology
was not a problem but understanding the business side of it … the shift from physical to
digital … that was a big change” (L., manager, 2010).

To deal with what we called the “digital versus physical” tension, Sonicbids reframed the
issue from an “either-or” opposition to a “both-and” and subsequently a “more-than” type
response to tensions. Enhancing the website, ensuring it was “user-friendly,” and
physically reaching out to individual promoters to help them understand the company’s
value proposition were some of the actions taken to deal with this “hurdle.” According to

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L., “we actually spent a lot of time meeting with these people one-to-one … it was all so
hands-on.” In other words, tensions in the industry brought on by digital changes were
reframed as complementary and handled through engaging the physical as well as the
digital. In this type of reframing, opposite forces were incorporated inside each other to
form a new whole. Thus, the digital system ended up embodying features of a physical
one in order to benefit stakeholders. In addition, changes in the music industry
emphasizing live performances reflected back on the organization-stakeholder context
and made it possible to also reframe the digital and the physical into a new whole.

Unintended consequences

Yet, each of these changes entailed unintended consequences that called, in turn, for
additional changes. As noted by a product manager (M., 2010), “any change you make
brings another change that you may not have anticipated.” Neither the founder nor
company members could anticipate “the masses of starving artists signing on to
Sonicbids” (interview with Panay, 2003) nor the weight that these empowered artists
would carry. In fact, as soon as artists stopped sending out traditional press kits (enabled
by the introduction of the EPK), more demands ensued to guarantee promoter attention.
This, in turn, resulted not only in new Sonicbids products and services (the “submission
tracker”) but perhaps, more importantly, a change in company thinking (“we are delivering
the promoters’ attention, not just a press kit”) and a change in industry norms about
promoter accountability. At the end of this period, traditional power relationships and
hierarchies looked dented as artists became empowered and promoters were asked to be
more accountable for receiving submissions. These consequences did not just impact the
direction that both the company and industry would take in “period 2”, but they propelled
ground-breaking changes by setting the conditions for all tensions, responses, and
ultimately changes that followed.

Period 2: developing the “artistic middle class”

By the end of 2003, several high-profile promoters had signed on (i.e. the Billboard Song
Contest) and hundreds of new artists joined Sonicbids. These successes led to the
company’s first million in sales. However, the explosive growth in “matching buyers and
sellers of music” created new tensions which brought, in turn, a new set of changes.

Individual-organizational tensions and responses

As a former music agent, the founder had worked with big jazz names like Chick Corea,
Sonny Rollins, and Al Di Meola, some of whom followed him to Sonicbids. But with the

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masses of “starving artists” signing on to Sonicbids, Panay began to question his initial
vision of an “eBay for musicians”; thus, strategic tensions rose over the company’s
direction. In a strategy meeting in 2003, he posed the question of whether Sonicbids
should break away from “big names” and focus on serving the mass market of “little
names” which could be more profitable. Staff disagreed calling the move “too scary.” Even
Panay struggled with these tensions, showed conflicted emotions, and feared the loss of
friendships. “After all, [he had] lengthy personal relationships with some of these ‘big
names’” (interview with Panay, 2008).

Despite pressures, Panay opted for what Champy (2008) describes as the “revolutionary
model … to compete by seeing what others don’t.” He urged staff members to select one
pole over the other, namely, to cultivate independent artists. When asked why he and
Sonicbids decided to opt for one group, he answered, “it had to do with reading the times
correctly and then taking a plunge” (interview with Panay, 2008). “Reading the times”
meant understanding the ubiquity of digital piracy, the drop in record sales, the increase in
live performances, and the growing trend for accessing music digitally. If record sales had
not plummeted, live performances might have never become the main revenue source for
a growing market of independent artists. Again, what we see here is a fluid context: as
organizations are changing, the context is also changing which demands that
organizations change again. Of course, this is happening as organizations are themselves
changing the context in which they are found.

Choosing one pole—independent artists—came with personal costs for the founder,
including doubts “not only about (his) decision but also about (his) value as a person,”
especially when one of the “big names” severed his relationship with the company and
“adorned (Panay) with horrible epithets” (interview with Panay, 2008).

Organizational-stakeholder tensions and responses

The tension surrounding what staff called “heavyweights” versus “unknowns” was evident
at the organizational level as well, since it was unclear whether Sonicbids could be
sustained without the support of “heavyweights” like jazz legends Sonny Rollins and Al di
Meola. As one member said, “(Around this time) there was a lot of frustration … (it was) a
tough decision …” (J, 2010). However, by 2007, the Sonicbids website explicitly described
the mission of the company “to help create and empower an Artistic Middle Class through
the use of innovative technology” (June 2007), clearly making a selection in responding to
the tension above.

Industry-wide tensions

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Rising “indie power,” a result of Sonicbids’ success, created a turning point in an industry
that was already undergoing changes. As technologically savvy, young artists who
capitalized on the Internet gained revenue-generating capabilities, the music industry
struggled between evolution and revolution as potential responses to a changing
marketplace. As the founder noted in email correspondence (2007), it had become clear
that the future was one where “artists of all types (could leverage) the power of the
Internet (to) build careers from the ground up, on their own terms” and called this a
“revolution of sorts where we break from the mold of the last hundred years.” These
changes did not just shift the industry but also the boundaries between artists and
organizations, altering past dependent relationships and leading artists to form their own
businesses.

Therefore, by giving independent artists power, Sonicbids carved a “third space” in the
music industry. Through shifts in power, decentralized networks of delivering services, and
a new mass market of profitable “little markets,” the industry transcended and actually
embraced both evolution and revolution. Evolution was the gradual rise of independent
artists, an artistic middle class, and power shifts through tech-savvy artists who managed
their own careers and revenue-generating capability. As the mass market of empowered
artists replaced the “broadcast era” of big names, a revolution emerged, one that
transformed the music industry.

Unintended consequences

Changes at the industry level influenced Sonicbids when organizational members
experienced unintended effects. Panay admitted that he “could never foresee how the
creation of an artistic middle class would alter power structures in the music industry so
dramatically” (interview with Panay, 2010). Nor could he foresee how industry changes
would require Sonicbids to drastically change itself.

As the “artistic middle class” gained power, artists began asking for “no submission fees.”
They were saying, “Why should I be paying you when I can do all this for free on Twitter
and Facebook?” (N., staff, 2010). According to the VP for Strategic Programs (2010), the
change in submissions happened quicker than they thought, partly because of the
changes that Sonicbids itself had created. The EPK was no longer a “strong marketing
tool to attract both members and venture capital,” and by 2010, the company had to
change to a tiered pricing system in which access to some promoters was completely
free, while a “super-sonic” membership fee allowed access to an unlimited number of
promoters. By 2011, the decision was formally enacted to move gradually to no
submission fees. Membership fees were, however, the company’s main source of revenue

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(US$4m in 2010). In other words, nurturing young, tech-savvy artists in a mass market
created the unanticipated potential to put the company out of business, especially at a
time when the economy was imploding.

Period 3: generating revenue—survival, expansion, and exponential growth

This period introduced another set of critical tensions regarding how Sonicbids could
continue to grow, especially with an economic downturn and major changes in the social
media landscape. Companies like MySpace began to provide substitutes for EPKs, and
social media outlets, such as Facebook and YouTube, became more serious competitors
for Sonicbids than any direct competition in the music industry.

Individual-organizational tensions

In response to these concerns and the push towards “no-fee submissions,” which resulted
from the unintended changes brought in the music industry by Sonicbids itself, the founder
was faced with a new tension: how could he offset the loss in revenue? On one hand, the
no-cost listings with no submission fees won back a large number of deactivated
members, so membership began to skyrocket again. But downsizing seemed inevitable.
Letting people go caused immense anxiety: “these are people with families, people we
shared Thanksgiving with” (interview with Panay, 2011). And, it was not a sufficient
change to keep the company on track. Faced then with a decision between “full versus
partial changes,” the founder argued that turning to brands and marketers was a
necessary direction, even though opposition from the Board was causing him stress and
burnout. Although staff members were used to “the company transforming itself every
couple of years” (BB., staff, 2011) and responded positively to changes, Panay mentioned
repeatedly in emails and conversations that he felt “exhausted.”

To address ongoing tensions over “full versus partial changes,” Panay adopted a “both-
and” way of integrating opposites which seemed to eventually lead to a “selection.” First,
he hired a new financial controller, rejuvenating a non-functioning finance department, and
strengthening the leadership team. Then, he invested in both personal and company
loans in the transition to a no-submission-fee system. Most importantly, he fought to bring
on alternative sources of generating revenue by seriously going after brands such as
Jeep, Zippo, and Gap who had previously reached out to Sonicbids for their marketing
campaigns.

Organizational-stakeholder tensions

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At the organizational level, staff saw Panay’s move towards brands as “selling out” and
some even thought he should resign. One younger staff member told us that “to remain
true to Sonicbids’ mission of promoting independent artists (they could) not sell out by
engaging in ‘commercial performances’” (W., 2010). Another told us that he had “stormed
into (Panay’s) office to say ‘I don’t understand why we are choosing to sell out like this’”
(J., interview, 2010). The VP for Strategic programs disagreed with them: “Brands are
really interested in music now and have become income for artists … there are gigs for
licensing and advertising” (KT, 2010). And, while the Board expressed skepticism as well,
other staff such as a special projects manager who had been with Sonicbids seven years
saw the new focus on brands as a “sign that the company manages change well.” The
fact that “we figured this out and were able to touch our financial goals (after the market
moved to no submission fees) is a testament to our team and to having the right mindset
for maintaining market lead” (H., 2010).

All proponents of the move toward brand advertising (Brands) saw that reframing the “true
to mission versus selling out” tension was essential. As H. (2010) said, “breaking old
habits is hard … but (we needed) a change in philosophy … we die without this move.” H.
and others saw Brands as “a new patron of the arts” that offered independent musicians
“even more cache.” Therefore, Panay and Sonicbids reframed the tension by forming a
new whole: branding as part of the music lifestyle. Panay reminded the Board that
Sonicbids had actually entered the brand business in 2003 when the auto manufacturer
Jeep hired them to stage a festival. Through this new “whole,” the company extended their
network of artists-promoters-fans to marketers, and by 2011, Sonicbids established a
Brands Division that worked exclusively with companies who wanted to increase brand
awareness and promote products and services through music. The company website
changed in 2011 to reflect this: “The bands, fans, and promoters who come together
through Sonicbids create a powerful resource for sponsors looking to connect with the
lifestyle of those driven by a desire to make, promote, and listen to great music”
(accessed August 2011). This “reframing” response shifted the boundary between the
organization and its stakeholders again.

In the wider debate of “being true to our mission versus selling out,” some staff members
also raised the issue of how the company was organized. Eleven years into its existence,
Sonicbids was still organized around a CEO-founder model and centralized decision
making. Yet, to remain an innovative tech company, some staff felt that “knowledgeable
tech people should be making decisions, not the CEO” (M., 2010). This struggle was
compounded by changes in moving from a start-up culture to a “business-y” environment;
tensions emerged as the company moved from a “very youthful music company where the

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average age was probably 26” (ST., 2010) to a more mature, “less flat,” more “business-y”
type culture “with mature engineers, software developers, and business minded staff—a
mix that is more balanced around skills and experience rather than cultural fit” (J.D.,
2010). Struggles over these tensions and way to enact changes were quite strenuous but
remained unaddressed at this stage.

Industry-wide tensions

As Sonicbids grappled with these tensions, the music industry experienced major changes
in the role of fans—again brought on by some of the changes described above.
Independent artists had at this point emerged as “trend-setters that influence the market”
and fans wanted direct contact with them. In what was called “the broadcast era,”
audiences were seen as an “amorphous mass of people” that supported artists. But with
the advent of social media, individual fans demanded interactions and relationships with
their chosen artists. On average, Sonicbids’ artists interacted with each of their 1300 fans,
at least once a day, through a tweet, a Facebook posting, or a blog (interview with Panay,
2011). This complex and changing role created internal tensions in organizations and the
industry, as well as a boundary change between organizations and yet another group of
stakeholders, fans.

By 2011, the music industry had become a collaboration among many actors as it moved
from the monologue of the broadcast model that transmitted music through radio,
television, and records to a dialogue in which fans interacted with artists on a daily basis.
The role of fans, alongside other stakeholders of the industry, was reframed to being a co-
producer and co-creator of music, even though this was another unintended consequence
of the changes enacted at this time.

Unintended consequences

Sonicbids responded to industry changes, but in the process had changed itself. As an
outcome of turning to Brands, Sonicbids developed a 20-staff member division that soon
became the strongest unit in the company and orchestrated marketing campaigns for
companies as diverse as Midas Brakes, Converse, and Red Bull. Brand revenue became
the pillar of music promotion and surpassed the sales of records in generating income.
Yet, the huge growth in brand market revenue which rose to US$3m in four years had an
overwhelming demand on company resources, a development which led Panay (interview,
2011) to ask, “Are we going to drown in the storm that we created?”

In addition, the founder admitted that “drastic changes had to be made for the company to
make the next step to a full-fledged cutting-edge tech company,” and shared that

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“everything is now on the table, including the possibility to sell the company.” Staff at
Sonicbids wondered about the cost of continual change. Does continuously adapting to
market conditions lead to “the risk of cannibalizing … our own business? … it is fun and
exciting … but we are not sure how we really go forward and keep our soul intact” (L.,

2010).2Figure 1 provides a visual representation of the aforementioned tensions,
responses, and unintended consequences driving the process of change at Sonicbids in
the three periods analyzed.

Discussion

Our study demonstrated how change-related activities and events crossed multiple
organizational levels that mutually interacted with each other. We see for example how the
founder’s decision in Period 1 to serve both struggling artists and elites interfaced the
individual-organizational level with institutional practices, as it drew on changes in the
music industry’s evolving focus on live performances. Similarly, in Period 2, the rise of
indie power at the organizational level redefined and shifted the dynamics among artists,
agents, and promoters at the industry level. Activities that crossed different levels also
intervened reflexively, in that the “revolution” of independent entrepreneurs at the industry
level in Period 2 shifted Sonicbids’ mission (organizational level) to focus on Brands in
Period 3. These changes across levels sometimes occurred simultaneously (i.e. the digital
revolution and serving struggling artists) and at other times followed each other
sequentially (i.e. indie power led to entrepreneurial practices that altered Sonicbids’
economic base through demands for free submissions). In effect, changing was a
continual experience driven by a complex set of interrelationships within and across
organizational levels as opportunities became threats and vice versa. In this way, the
organization was changing while it was being changed through aligning choices and
activities within and across levels.

Importantly, the pattern of tensions across periods suggested that radical change or major
turning points occurred when power shifts infused different levels (artist-agent at the
meso-level crossed into music industry at the macro-level). Independent artists became
empowered through the EPK, a Sonicbids practice that catered to them and their
changing role in the music industry. Thus, changes that initially occurred at the individual-
organizational level transformed an industry in permeating organizational and institutional
environments.

This reflexive ongoing pattern of changing altered both contexts and boundaries. In
response to the first research question (RQ1) as to how organizational contexts and

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boundaries changed, this study suggested that each level served as a background or
context for the other levels. Specifically, the music industry that served as a context for
Sonicbids’ activities was clearly in flux, for example, advent of digital piracy, growth in live
performances, and changing role of fans. Boundaries between levels were also fluid. In
particular, stakeholders at the meso-level (i.e. independent artists) often became
important organizational players through influencing Sonicbids’ structures, leadership, and
decision practices; for example, artists became their own agents; or brands developed
into “a new patron of the arts” that led to a new Sonicbids division. As boundaries between
levels became increasingly porous or fluid, organizational internal processes shifted to
adapt.

In response to RQ2, unintended consequences arose naturally in conjunction with
changes. No one could have anticipated that designing a digital system for “starving
artists” would create an empowered artistic middle class that would then lead to an
industry-wide revolution. Moreover, unanticipated consequences often grew out of
successes rather than failures. For example, the consequence of moving to free
submissions stemmed in part from Sonicbids’ success in developing indie power. In turn,
this practice produced new tensions surrounding organizational mission and economic
survival. Appendix 1 and Figure 1 identify the unintended consequences for each set of
tensions and illustrate how these unanticipated effects fueled additional tensions.

In response to RQ3, the types of tensions and responses to them, we see that they
differed across organizational levels. Specifically, founder decisions typified tensions at
the individual-organizational level: for example, serving struggling artists versus elites or
relying on big names versus less known names. For the founder, these tensions
represented either-or struggles that produced anguish and stress over choosing one pole
and accepting the consequences of his decisions, for example, dissolving friendships with
big name clients or downsizing to save the company. Efforts to integrate poles, such as
serving both struggling artists and elites, or developing partial fee plans often led to an
either-or selection over time (choosing struggling artists and moving to free submissions).

At the organizational-stakeholder level, tensions were tied to the shifting roles of clientele,
that is, artists, agents, and promoters. They centered specifically on who was privileged
and who was marginalized in any change process. This type of tension triggered creative
responses, reframing, redefining relationships, and thinking outside of the box to meet the
needs of multiple stakeholders. At the industry/macro-level, the types of tensions focused
on the music industry itself, especially opportunities and threats, such as digital versus
physical submission systems and evolution versus revolution. Responses were creative

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ways of aligning opposites—folding one pole inside the other (physical inside the digital)
or creating a third space to allow for both evolution and revolution. In effect, the three
levels differed in terms of the types of tensions that emerged and the responses to them.

Moreover, three patterns of tensions and responses to them surfaced from this study
(RQ4). First, selecting one pole or either-or responses were more likely to occur at the
individual-organizational level linked to leadership, mission, and organizational vision.
Second, both-and, integrating, balance, and compromising responses seem tightly linked
to unintended consequences from past changes that colored future actions. They also
often evolved into selection or an either-or response over time; for example, tier pricing of
submission fees led to no fees over time. Third, more-than responses such as reframing,
transcendence, and creating a third space operated at the strategic level in which the
organization redefined and created a new whole; for example, redefining fans as co-
producers or reframing brand marketing as a new music lifestyle. Organizational actors
employed more-than approaches at organizational-stakeholder levels as well as industry-
environment interfaces.

Drawing on Figure 1 and the schematic representation of tensions, responses, and
unintended consequences, we constructed a general model of change processes and
relationships. Figure 2 depicts the reflexive relationships of multilevel change. The
diagram on the left represents the interactions of the three levels of change—the
individual (micro), the organizational (meso), and the industry (macro)—as permeable
concentric circles in which change on one level influences the other levels continuously.
The boundaries between levels represented by the dotted lines are fluid and constantly
changing due to the ongoing tensions and responses that generate continuous change.
The circles (on the left) demonstrate a “top-down view” of what is actually a three-
dimensional (3D) cone (on the right) that signifies the cyclicality and reflexivity of change
as it moves constantly in a 3D plane across time. Tensions and responses to them
generate movement which introduces a new set of tensions that develops through a
continuous cyclical pattern. In effect, Figure 2 embodies a space-time movement in which
the cone moves both along its axis (through tensions-responses) and across time
(through the resulting intended and unintended consequences of tensions and responses
to them). At the same time, the lines between the three levels are shifting and permeable
(shown by the dotted lines) as they influence each other, but also as one level dominates
the other two in different periods. To illustrate, for Sonicbids, the tensions and responses
at the micro-level seemed more defining of change in Period 1, the macro-level in Period
2, and the meso in Period 3.

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Figure 2. Reflexive relationships of multilevel change.

Figure 2 also shows how unintended consequences of choice set the stage for
organizational changes. Change is therefore shown as a dynamic, non-linear, continuous
phenomenon, sometimes characterized by chaotic dynamics (Langley et al., 2013). As the
tension/response arrows demonstrate, consequences emerge on their “own volition”
without an identifiable agent of change (MacKay and Chia, 2013), as noted by the
“unowned” (p. 211) view of change. Consistent with this position, managers as conscious
agents can act purposively, but their choices and deliberate actions are necessarily partial
and, as such, unintended consequences are integral to the change process, perhaps as
instigators of change.

Conclusion

Our study shows how change is a reflexive interplay among tensions, responses, and
unintended consequences across three different organizational levels. As such, it makes
several contributions. First, in theorizing about change, this study illustrates how change-
related activities and events at the micro-, meso-, and macro-levels reconstitute
organizing. These levels are in flux and mutually interacting with each other, so changes
in one arena interrelate with and interfuse changes in other arenas—sometimes
sequentially but often simultaneously. This process is reflexive in that the act of changing
reflects back on and alters the process of change itself. Therefore, changing is a continual
experience in that tensions related to choices and consequences from them fold back on
organizing to generate more tensions, which in turn promote further change.

Unlike the traditional view of stability versus change that treats the two either as a binary
or as a complementary dualism, we contend that what promotes stability produces change

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and vice versa (See also Kassinis and Panayiotou, 2017). Thus, the two are intertwined
and related to the process of forging order (stability) out of disorder (change/chaos). It is
this continual fluctuation between order and disorder that cast stability and change as
paradoxically interwoven.

Our study also questions the static nature of boundaries; that is, boundaries shift as
tensions and unintended consequences impinge on change. Thus, boundaries across
organizational levels are not rigid constructs, but shift dynamically during changes. In
addition, consistent with the “unowned view” of change, our study places unintended
consequences at the center of the change process—not as a negative outcome, but as an
integral part of generating tensions that fuel ongoing change. This study also contributes
to the growing literature on organizational tensions in showing how they co-evolve and
become interconnected across organizational levels. Specifically, patterns of tensions and
responses to them may emerge as level-specific with either-or tensions tied to leadership
choices and reframing and transformation responses linked to strategic levels.

Finally, this study and the model that it proposes (Figure 2) have important implications for
the “practice” of change. Specifically, this model showcases the significance of an
individual actor in bringing about change, even though everyday micro-actions may seem
“unimportant” and “trivial” at the time. More importantly, it elevates relationality through
demonstrating how events that evolve over time become intertwined with actions and
interactions across multiple organizational levels. These processes also diffuse the
negativity that often surrounds “tensions” and “unintended consequences” through
emphasizing ways to respond creatively to them rather than striving to control them.

Appendix 1. Tensions, responses, and unintended consequences per
period (exemplar interview quotations).

Acknowledgements

The authors would like to thank the Editor, Ann Langley, and the three anonymous
reviewers for their powerful suggestions during the review process. Christina Kyprianou
and Manolis Diakourakis provided valuable assistance in various stages of the study. The
interviewees who shared their insights made the study possible; we remain grateful for
their time and for the access we were granted.

Declaration of Conflicting Interests
The author(s) declared no potential conflicts of interest with respect to the research,

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authorship, and/or publication of this article.

Funding
The author(s) received no financial support for the research, authorship, and/or
publication of this article.

Notes

1. A “gig” can include a live performance, participation in music festivals or contests,
opportunities to have music featured in movies, commercials or other promotional live
events, and licensing opportunities (https://www.sonicbids.com).

2. In January 2013, Sonicbids was sold to a Guggenheim-owned company, Backstage,
for approximately US$15m.

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Author biographies

Alexia Panayiotou (EdD, Harvard University) is an Assistant Professor in the Department
of Business and Public Administration at the University of Cyprus. Her research interests
include the role of paradox and tensions in organizational life, especially in changing
industries; the representation of management and organizations in popular culture;
organizational space and symbolism; feminist analysis of organizations; and visuality and
organizational narratives. Her work has appeared, among others, in Organization,
Management Learning, the Journal of Management Inquiry, and the European
Management Review. Her article “Paradoxes of change” (co-authored with G. Kassinis),
featured in the best paper proceedings of the Academy of Management, received the

http://scholar.google.com/scholar_lookup?hl=en&volume=27&publication_year=2002&pages=222-247&author=MG+Seo&author=WED+Creed&title=Institutional+contradictions%2C+praxis%2C+and+institutional+change%3A+A+dialectical+perspective

https://journals.sagepub.com/servlet/linkout?suffix=bibr68-1476127017734446&dbid=16&doi=10.1177%2F1476127017734446&key=10.5465%2Famr.2002.6588004

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http://scholar.google.com/scholar_lookup?hl=en&volume=38&publication_year=2017&pages=463-488&author=M+Sheep&author=G+Fairhurst&author=S+Khazanchi&title=Knots+in+the+discourse+of+innovation%3A+Investigating+multiple+tensions+in+a+reacquired+spin-off

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Interview With Panos Panay, Founder and CEO Of Sonicbids

http://scholar.google.com/scholar_lookup?hl=en&publication_year=2009&author=J+Widran&title=Special+interview+with+Panos+Panay%2C+Founder+and+CEO+of+Sonicbids

2021/1/28 Generating tensions: A multilevel, process analysis of organizational change – Alexia Panayiotou, Linda L Putnam, George Kassinis, 2019

https://journals.sagepub.com/doi/full/10.1177/1476127017734446 37/37

2016 Best Paper Award in the Academy’s Organizational Development and Change
division, and was a finalist for the all-Academy Dexter Award. She has served as an
Associate Editor of the European Management Review and is currently an Associate
Editor of Management Learning.

Linda L Putnam (PhD, University of Minnesota) is a Distinguished Research Professor in
the Department of Communication at the University of California, Santa Barbara. Her
research interests include paradoxes and contradictions in organizations, organizational
discourse analysis, and conflict management. She is the co-editor of 11 books and her
published articles appear in such journals as Academy of Management Review, Human
Relations, Organization Studies, and Negotiation Journal. She is a distinguished scholar
of the National Communication Association, a fellow of the International Communication
Association and the International Association for Conflict Management, and the recipient
of life-time achievement awards from the International Association for Conflict
Management and Management Communication Quarterly.

George Kassinis (PhD, Princeton University) is an Associate Professor of Strategy in the
Department of Business and Public Administration at the University of Cyprus. His
research interests include Strategy, Sustainability, Social Entrepreneurship, Corporate
Governance, and Corporate Social Responsibility. He has published in journals such as
Academy of Management Journal, Strategic Management Journal, Production and
Operations Management, and Journal of Business Ethics.

021/1/28 Organizational Change Done Right: Examples from the Giants of the Industry

https://www.tinypulse.com/blog/3-examples-of-organizational-change-and-why-they-got-it-right 1/11

Organizational Change Done Right: Examples
from the Giants of the Industry

Every company needs to embrace organizational change if they want to stay at the top of their game.

But organizational change is tough. It requires vision, big budgets, and special talents in order to deliver successful results.

In fact, 70% of change initiatives fail as a result of bad management, poor implementation, or even bad luck.

The most tricky part is that every company is in a different place when it comes to their position, their market, and their
current needs. So there’s no fixed, magic way that every company can use to implement change successfully.

What does help, however, is to see how big companies managed to implement organizational change successfully and
study how they did it and why it worked.

Effective Organizational Change Leads to More Engaged Workforce
Organizational change happens when a company decides to change its structure, strategies, culture, policies, technology, or
even its core values in order to improve performance and business growth.

Reasons to implement change include:

Adapting to market changes

Digital transformation and technology upgrades

Solving internal problems with organizational structure and bureaucracy

Improving processes and procedures

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Every company is unique, so the reasons to enact organizational change are essentially endless.

Organizations can’t skip organizational change, either, as change is essential to survive.

According to recent research, two out of every three organizations have to change at least four times every five years. In
other words, if you want to remain competitive, you need to embrace change sooner or later. Otherwise, your competitors
will leave you behind.

When done correctly, organizational change can turn your company into a more competitive and effective business — and
a better place to work.

But enacting change is easier said than done. By looking at examples of other companies that have successfully enacted
organizational change initiatives, you can get a better idea of what successful change management looks like — and use
that information to inform your own internal initiatives.

What Does Successful Organizational Change Look Like?
Let’s dive into some examples of organizational change to uncover what organizations did and how they did it successfully.

01. Microso�’s organizational transformation and new purpose

Expanding the company to reach new audiences

Launching a rebranding campaign
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SOURCE: Manu Cornet

Microsoft was running into serious internal problems with its organizational structure.

It wasn’t until the new CEO Satya Nadella took charge and started to undertake some major restructuring for this massive
company. At a very high level, we can see some of the fruits of Nadella’s ideas by looking at Microsoft’s stock price.

A split company can’t grow

Even after the phenomenal and long-lived success of Windows and Office products, Microsoft was struggling to keep up with
other companies — specifically, with Google becoming dominant in the search and software market and Apple owning the
phone market.

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http://fortune.com/satya-nadella-microsoft-ceo/

After 5 years, Microsoft CEO Satya Nadella has transformed more than the stock price

http://www.businessinsider.com/satya-nadella-achieved-one-microsoft-vision-2016-1

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The tech giant was stagnant and rife with internal wars between major departments that often viewed each other more as
competitors than partners within the same company.

As a result, innovation was being thwarted by a toxic environment that kept the company increasingly dependent on
Windows and Office. While both products are very successful, the stagnation put the company in a dangerous “comfort”
zone.

How Microso� optimized its processes and unified its teams

After being named CEO in February 2014, Satya Nadella undertook a major restructuring of the tech giant to eliminate its
destructive internal competition.

Microsoft products and platforms would no longer exist as separate groups. Instead, all employees would start focusing on
a limited set of common goals — and bringing them all together. Their new common functions include:

In September 2016, Nadella created a new AI and Research Group by merging their original research group with the Bing,
Cortana, and Information Platform teams. This move brought roughly 5,000 engineers and computer scientists together to
focus on artificial innovation across all Microsoft product lines.

A new, meaningful mission

Right at the beginning, Nadella shared a new sense of mission with his employees: “To empower every person and every
organization on the planet to achieve more.”

He also recalled his thought process: “Over the past year, we’ve challenged ourselves to think about our core mission, our
soul — what would be lost if we disappeared… We also asked ourselves, what culture do we want to foster that will enable
us to achieve these goals?”

Prior to the restructuring, employees had been lacking a positive sense of purpose, with the result being low morale and
weakened employee engagement.

And thanks to Nadella’s initiative, all Microsoft’s employees are following a common goal that brings real meaning to their
work.

As of today, Microsoft’s restructuring is still in progress. But its future still looks brighter — perhaps even brighter than ever
— as a result of its new, well-established mission.

Reinventing productivity and business processes

Building an intelligent cloud platform

Creating more personal computing

https://www.tinypulse.com/blog/sk-toxic-work-culture-kills-retention-rate

https://www.wired.com/2015/01/microsoft-nadella/

Satya Nadella emails the troops, reveals new mission statement

https://www.tinypulse.com/blog/topic/topic-employee-retention

https://www.tinypulse.com/blog/meaningful-work-for-employees

https://www.thestreet.com/story/13632641/1/jhonsa-microsoft-rsquo-s-latest-restructuring-aimed-at-improving-collaboration.html

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02. Google splits up under the Alphabet umbrella

Imagine growing so much that you need to break yourself apart to work better?

Think that sounds unbelievable? Well, that’s exactly what Google did when it became Alphabet.

After dominating a plethora of hi-tech projects, Google co-founder Larry Page thought it was time for him to reorganize the
entire company again.

Being a “giant” company isn’t always good

Back in the early 2000s, Google was already a monster, dominating internet search and making itself indispensable in our
lives with products like Google Maps and Gmail.

Its R&D teams were seemingly interested in everything, searching for what co-founder Larry Page termed “moonshot”
projects, which were supposedly impossible for Google engineers to make real. But the company wanted them to try
anyway.

As a result, Google grew extremely diverse. The company started tackling all kinds of projects, including ones relating to
human longevity, smart vehicles, wearable tech, smart homes, and more.

It was all connected, to an extent. But at the same time, it wasn’t. Google was becoming an increasingly impossible entity to
manage. So, in order to save serious troubles in the future, Page decided it was time to deconstruct the entire
conglomerate.

How Google became a part of another company

https://www.forbes.com/profile/larry-page/

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Page broke up Google into different companies, all of them owned by a new umbrella corporation called Alphabet.

Page sits at the top as CEO of Alphabet, with Google co-founder Sergey Brin as president, and long-time Google exec Eric
Schmidt as chairman (who le� Alphabet in 2020). Each of Alphabet’s companies has its own goals and a CEO focused
solely on those goals.

In a blog post, Page wrote this: “Fundamentally, we believe this allows us more management scale, as we can run things
independently that aren’t very related. Alphabet is about businesses prospering through strong leaders and independence.”

And as the post goes, Larry’s motivators to make this change included:

Essentially, Google wanted to separate every major project into independent organizations with unique goals and
ambitions. That way, it would be easier to manage and scale.

Giving employees accountability leads to 10x company growth

Larry Page made clear his thinking when the launch of Alphabet was announced, explaining that the reorganization would
free the employees to concentrate more productively and happily on their own mission without having to be concerned
about Google overall.

This means that every Alphabet’s company is now responsible for its own expenditures and income. But at the same time,
the increased responsibility could make innovation more meaningful.

In the end, what truly paid off for Google (now Alphabet) was the long-term vision Page had for the company, which drove
him to lead a change management initiative for the good of his organization.

03. British Airways restructures its entire organization

British Airways is the largest airline in the U.K. as a result of merging with four other companies.

Getting more ambitious things done

Taking the long-term view

Empowering great entrepreneurs and companies to flourish

Investing at the scale of the opportunities and resources we see

Improving the transparency and oversight of what we’re doing

Making Google even better through greater focus

And hopefully…as a result of all this, improving the lives of as many people as we can

https://www.wired.com/2015/08/new-company-called-alphabet-owns-google/

https://www.cnbc.com/2020/05/09/eric-schmidt-is-reportedly-no-longer-an-advisor-to-the-company.html

http://googleblog.blogspot.com/2015/08/google-alphabet.html

https://www.tinypulse.com/blog/4-key-times-strong-leaders-support-their-employees

https://www.tinypulse.com/webinar-lead-like-a-microsoft-exec-2021

2021/1/28 Organizational Change Done Right: Examples from the Giants of the Industry

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Due to this massive merger, the organization faced huge problems to manage itself and bring a decent service in the
immediate aftermath.

It wasn’t until its privatization and the incorporation of the new chairperson, Lord King, that the company started to enjoy
positive momentum — and increase their profits accordingly.

Standardize customer service a�er new chairperson taking charge

Created in 1974 from four other companies — BEA, BOAC, Northeast Airlines, and Cambrian Airlines — they formed a
business with 215 aircraft supported by 50,000 employees.

This level of staffing was — even then — viewed as precariously oversized. And on top of that, the oil crises of the 1970s
shrunk the airline’s customer base, which, in tandem with its huge staff, resulted in massive financial losses.

The company soon developed a reputation for its terrible service. So, in 1981, British Airways brought on a new
chairperson, Lord King, who noticed that the company was operating very inefficiently and wasting valuable resources.

How BA boosted its profits by reducing personnel and upgrading its fleet

To increase profits, King decided to restructure the entire organization by reducing its workforce from 59,000 to 39,000,
eliminating unprofitable routes, and modernizing the fleet. Over the course of two years, Lord King had replaced over half of
the company’s board.

He repaired the airline’s image by bringing in a new marketing expert and hiring Colin Marshall as the new CEO in 1983.

Within 10 years, the airline reported the highest profits in its industry: $284 million.

Transparent communication and e�ective change management leads to greater profits

Before King began announcing layoffs, he explained his reasons for the restructuring to the entire company to prepare
them for the upcoming change.

His communication effort arose a sense of urgency within the company and prepared them to embrace change.

Without his transparency, British Airways could have experienced employee backlash and negative press around all the
layoffs. But the chairperson always communicated honestly and frequently to manage the change.

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https://www.ukessays.com/essays/management/explaining-the-change-management-at-british-airways-management-essay.php

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A Step-by-Step Guide to Implementing Organizational Change

Implementing change in your organization can easily become an overwhelming challenge — especially if your company
doesn’t have Google’s deep pockets.

So, if you want to increase your chances to enact change successfully — and transform your company’s life forever —
following these best practices will help you manage organizational change smoothly and with less resistance:

Getting a tangible, realistic vision. Determining what you want your organization to look like in the future is critical to
success. This allows you to trace the roadmap that will guide you to reach your goals.

Embracing change management. The most difficult part of change is overcoming people’s natural resistance to
switching things up. For this reason, you need to implement the right change management model for your business and
get ready to deal with your team’s dissatisfaction.

Getting constant feedback from your team and employees. You need to find ways to get real feedback directly
from your team so you can constantly improve the process. A great way to do this is through regular pulse surveys.
That way, every employee can know that they’re being heard, which improves employee engagement.

Using the right tools. Make sure you’re getting tools that are helping you to keep track of your project and improve
your communication. Otherwise, you may find yourself having to deal with some unnecessary problems.

Leading the project with top leadership skills. Your company needs strong thought leadership if you want to move
your current organization to a better state. Ensure that you’re sharpening your leadership skills frequently if you want to
lead a change management initiative properly.

Communicating as effectively as possible. Communication can mean the difference between success and failure. If
you find that your company is having communications problems, it’s time to address this issue as soon as possible.
Failure to do so could very well mean you’ll face some hard times.

https://www.tinypulse.com/blog/how-to-implement-change-management-a-step-by-step-guide-to-successful-organizational-change

https://www.tinypulse.com/blog/sk-case-studies-successful-change-management

https://www.tinypulse.com/engage

https://www.tinypulse.com/blog/sk-top-leadership-qualities

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Following these practices will help you approach organizational change properly.

But it doesn’t end there. Organizational change is a long journey, one that doesn’t really ever end, and there’s a lot you still
need to learn.

The Final Takeaway
If there’s something these three examples have in common, it’s that they all show how important it is to think out of the
box and be willing to take any action to succeed.

Now that you know how the giants of the industry approach change, it’s your turn to prove yourself and take action!

So go on and start brainstorming some great ideas for the future! We’re rooting for you.

“I would say that 70-80% of our leadership strategy comes from ideas that are solicited through TINYpulse.”

— Nick Smarrelli, CEO at Gadellnet Consulting Services

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Case Study: Leveraging Engagement Surveys During Organizational Change

Copy These Examples of Successful Organizational Change

Definitive Guide to Employee Engagement

  

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http://www.tinyhr.com/blog/case-study-leveraging-employee-engagement-surveys-during-organizational-change?__hstc=225544837.94fb4b3c28c98243de299664bb5c2f00.1611887481531.1611887481531.1611887481531.1&__hssc=225544837.1.1611887481531&__hsfp=829518355

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Lori Li

June 16, 2020

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2021/1/28 Science of Organizational Change | Winning the ’20s

https://www.bcg.com/publications/2019/science-organizational-change 1/1

MAY 02, 2019

By Lars Fæste, Martin Reeves, and Kevin Whitaker

here is a gap between where most organizations are today and where they will

need to be to succeed in the coming decade. The companies that win in the 2020s

will be designed to constantly learn and adapt to changing realities, combine artificial

and human intelligence in new ways, and harness the benefits of broader business

ecosystems. Reaching this necessary future state will require a fundamental

transformation.

This change effort will be challenging. Many businesses have deeply entrenched

operating systems that are predicated on hierarchy and human decision making. They

will need to redesign their internal processes and build new capabilities and business

models. Furthermore, this will not be a one-time change effort: the dynamic nature of

business will require organizations to build capabilities for ongoing large-scale change to

keep up with evolving technology and competition.

THE SCIENCE OF ORGANIZATIONAL CHANGE



https://www.bcg.com/about/people/experts/lars-faeste

https://www.bcg.com/about/people/experts/martin-reeves

https://www.bcg.com/about/people/experts/kevin-whitaker

https://www.bcg.com/publications/2019/company-of-the-future

https://www.bcg.com/publications/2019/new-logic-of-competition

2021/1/28 Science of Organizational Change | Winning the ’20s

https://www.bcg.com/publications/2019/science-organizational-change 2/18

Traditional approaches to enacting organizational change are generally not very

effective. Change management is generally thought of as one-size-fits-all and based on

plausible rules of thumb. But our research shows that only about one in four

transformations succeeds in the short and long run, and the success rate has been

trending downward. Meanwhile, the stakes are extremely high: the cumulative

difference between success and failure for the largest transformations over a decade can

add up to the company’s entire market value.

Leaders need to take a new approach to change—one that deploys evidence, analytics,

and emerging technology. In other words, leaders must apply the emerging science of

organizational change, which is based on five key components. (See Exhibit 1.)



THIS WILL NOT BE A ONE-TIME CHANGE

EFFORT.

Ground change programs in evidence.1.

De-average change strategies according to the nature of the challenge at hand.2.

Embrace uncertainty and complexity in change management.3.

Use technology to identify the right talent to execute change.4.

Tap into emerging science to enhance change programs.5.



https://www.bcg.com/capabilities/business-transformation/change-management

2021/1/28 Science of Organizational Change | Winning the ’20s

https://www.bcg.com/publications/2019/science-organizational-change 3/18

GROUND CHANGE PROGRAMS IN EVIDENCE

When it comes to understanding how to enact change, business leaders have often relied

on intuition and experience. In a typical transformation effort, the program design,

choice of tactics and value levers, and ongoing management are often based on little

more than subjective data such as customer surveys and progress reports. But the

increasing availability of data, together with novel analytical approaches, has made it

possible to empirically decode what really works and what doesn’t. Leaders thus need

an evidence-based approach to transformation.

Our empirical analysis of hundreds of large companies that experienced major

change reveals a number of lessons. In the short term, the most successful companies

articulated a compelling story to reset investors’ expectations in addition to improving

efficiency. (See Exhibit 2.) In the longer term, they took actions to increase revenue

growth, such as spending more on R&D. They launched formal transformation

programs, rather than a series of ad hoc improvements, and invested in them

sufficiently. And they initiated their transformations preemptively, when things were

still going well, instead of in reaction to declining performance.



https://www.bcg.com/publications/2017/transformations-people-organization-that-work-why

https://sloanreview.mit.edu/article/the-truth-about-corporate-transformation/

https://www.bcg.com/publications/2018/preemptive-transformation-fix-it-before-it-breaks

2021/1/28 Science of Organizational Change | Winning the ’20s

https://www.bcg.com/publications/2019/science-organizational-change 4/18

To succeed in the next decade, leaders can apply such an evidence-based approach to all

types of change situations—turning transformation from a reactive necessity into a

competitive opportunity. For example, empirical analysis can help companies

successfully acquire and transform underperforming businesses: our research shows that

although such “turnaround M&A” deals are very risky, there are demonstrable ways to

beat the odds. These include launching turnaround initiatives quickly and setting

ambitious synergy goals, as well as giving attention to key soft factors—for example,

companies with a well-defined purpose had significantly better outcomes in turnaround

deals, demonstrating the importance of motivating employees on the change journey.

A similar approach can also help companies respond to changing external conditions,

such as an economic slowdown: while most companies see performance decline during a

downturn, a minority thrive—and historical analysis can identify what sets them apart.

What steps can leaders take to adopt an evidence-based transformation approach?

DE-AVERAGE CHANGE STRATEGIES

Organizational change is often seen as a single type of challenge that calls for a single

type of change management in all situations. Accordingly, most change efforts follow a



LEADERS CAN USE AN EVIDENCE-BASED

APPROACH TO TURN TRANSFORMATION

FROM A REACTIVE NECESSITY INTO A

COMPETITIVE OPPORTUNITY.

Draw insights from the full range of historical evidence, rather than relying only on

personal experience or rules of thumb.

•

Build analytical capabilities to be able to identify tailored insights for your

individual change situation and optimize program design accordingly.

•

Create a sense of urgency in your organization to make the case for preemptive

change.

•


https://www.bcg.com/publications/2019/increase-your-chance-success-transformative-mergers-acquisitions

https://www.bcg.com/publications/2018/creating-urgency-amid-comfort

2021/1/28 Science of Organizational Change | Winning the ’20s

https://www.bcg.com/publications/2019/science-organizational-change 5/18

recipe with common ingredients: for example, centralized program offices, periodic

pulse checks, measurement against predefined milestones, and a one-shot process with a

clear end date.

In reality, there are many types of organizational change that present very different

challenges and have very different requirements. Leaders need to de-average

organizational transformation into various components and understand the right

approach for each.

Change can be considered as movement across a “landscape” of possibility, where each

point corresponds to a different possible state of the organization. Organizations try to

seek “higher ground,” which corresponds to higher performance. Different change

situations can be considered along two dimensions: Is the target destination clear (the

ends)? And is there a clear path to get from here to there (the means)? (See Exhibit 3.)

De-averaging the challenge this way reveals five types of change strategies, each of

which requires a fundamentally different approach to change management:

A planned itinerary represents the traditional approach to organizational change.

This is appropriate when there is a clear goal and obvious steps to get there. For

example, HSBC identified a clear opportunity to simplify and streamline its

business, through the well-defined means of exiting noncore locations and

•
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eliminating excess organizational layers. It executed the program with a typical goal-

oriented approach, setting clear cost and profit targets, reporting its progress against

those targets, and clearly defining accountability.

A river crossing strategy is more appropriate when there is a clear goal but the path

to get there is unknown.

Notes:

For example, Starbucks in 2008 understood it needed to increase customer loyalty

but didn’t know precisely how to do so. Rather than planning its change program in

detail, it took a more experimental approach to find the best path—running pilot

programs in emerging areas like social media, learning from those efforts, and

amplifying the actions that made concrete progress toward its goal.

Notes:

•
1

1 As coined by Deng Xiaoping, who described China’s reform effort as “crossing the river

feeling for the stones.”

2 Nancy F. Koehn et al., “Starbucks Coffee Company: Transformation and Renewal,” Harvard

Business School Case, June 2014.

A hill-climbing strategy is needed when the means of change are clear but the end

state is not. For example, John Deere recognized that the importance of the Internet

of Things would continue to grow, but the company has taken an open-ended

approach to its investments in the technology: rather than defining an end goal

from the beginning, it started with a few minimum viable products that were

believed to be heading in the right direction. After learning more about the value of

those products, the company aims to “build from those and create a broader service

•
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Major transformation programs, such as the ones many companies will have to undergo

to reinvent themselves for the next decade, require a composite of these strategies—in

which various change management approaches are applied in sequence, or in different

around them”—eventually reaching an end state that likely could not have been

foreseen.

Notes:

3 Tim Greene, “John Deere is plowing IoT into its farm equipment,”

Network World, May 2016.

Companies may seek change even when they know neither the ends nor the means

—for instance, when they are looking for the next big opportunity. This situation

calls for a strategy of scouting and wandering. For example, the Japanese company

Recruit instituted an exploratory program called Ring, which allows any employee

to propose a new business in any field, not only those related to the company’s

existing products. The program receives more than 1,000 new ideas every year,

some of which have become substantial businesses for Recruit.

•

Finally, some companies face situations in which the only clear imperative is to

change substantially and urgently, which demands an escape the swamp strategy. For

example, facing severe threats in 2012, Best Buy adopted the philosophy, “If we

don’t change, we are going to die.”

Notes:

The company pursued bold, pragmatic moves without exhaustive evaluation,

because they represented the best chance to promptly escape an adverse situation.

•

4 Susan Berfield and Matthew Boyle, “Best Buy Should Be Dead, but It’s Thriving in the Age of

Amazon,” Bloomberg Businessweek, July 2018.

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parts of the business simultaneously. Companies therefore need to develop capabilities

to tackle each type of change effectively.

A few key imperatives can help leaders leverage the required variety of change

strategies:

EMBRACE UNCERTAINTY AND COMPLEXITY IN CHANGE MANAGEMENT

Businesses have traditionally been managed with a “mechanical” mindset. This

mentality assumes that everything that needs to be known can be known, everything

that needs to happen can be planned, and all necessary change can be enacted through

direct intervention.

However, companies are composed of people who interact with one another and with a

complex dynamic environment. So businesses, like other biological systems, behave like

nested complex adaptive systems. Lower-level systems (such as individuals) are embedded

in higher-level systems (such as teams, business units, companies, industries, national

economies, and societies)—and changes in any system can cause unintended and

unpredictable effects in others.

Interactions between individuals or systems are becoming even more complex today,

because employees, companies, and economies are more connected as a result of

digitization, and because production is starting to be organized in dynamic

multicompany ecosystems rather than traditional static supply chains. Therefore,

mechanical approaches to change management are increasingly inadequate. Instead,

Understand the variety of potential change challenges and the tactics required to

succeed in each.

•

Divide complex transformation efforts into their components, and select change

strategies accordingly.

•

Build organizational and leadership capabilities to enact multiple types of change

simultaneously.

•
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leaders need to employ a “biological” approach, which is more realistic about what can

be known and directly controlled.

Biological management involves several principles:

These principles point to new strategies for enacting change in business. To address a

complex task (for instance, shifting a company’s culture), direct interventions (such as

mandating individual behaviors) are unlikely to bring about the required change.

Indirect interventions—those that change the mindset, assumptions, and context that

underpin employees’ actions—often prove to be more effective because they touch the

deeper, more persistent drivers of behavior.

Biological approaches also enable the orchestration of external change, such as shaping

the behavior of other players in a business ecosystem. For example, early in the

evolution of its Taobao e-commerce platform, Alibaba wanted to expand the range of

offerings by making it easier for small or inexperienced sellers to join the market.



A BIOLOGICAL APPROACH TO CHANGE IS

REALISTIC ABOUT WHAT CAN BE KNOWN

AND DIRECTLY CONTROLLED.

Adapt to changing conditions by seeing what works, rather than designing or

deducing static solutions.

•

Shape the organizational context, rather than dictating individual actions.•

Allow new approaches to emerge from a diversity of perspectives, rather than

relying on standardization.

•

Observe how the organization behaves as a whole, rather than optimizing

individual parts.

•

Compete on resilience and preparedness for the unknown, rather than only static

efficiency.

•
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Rather than addressing this challenge through direct actions, the company set up

Taobao University—a platform on which established sellers could produce certified

training materials for new sellers. By finding this indirect leverage point, Alibaba was

able to capture the best wisdom from its marketplace, transmit it to potential sellers

with greater scale and specificity, and improve the quality of services on Taobao, which

ultimately became the world’s largest e-commerce website.

What steps can leaders take to embed biological thinking in change management?

USE TECHNOLOGY TO IDENTIFY THE RIGHT TALENT TO EXECUTE CHANGE

Large-scale organizational change often results in a need for new capabilities, which may

be found by reallocating workers within the enterprise or by identifying new talent

externally. To execute change effectively, it is therefore necessary to develop strategies

for identifying individuals’ unique skills and matching them to the right roles.

The challenge of aligning skills with positions, like many other aspects of large-scale

change, has generally been based on subjective judgments of individuals’ track record of

performance in different roles. But advances in science and technology are unlocking

new possibilities. The study of neuroscience, and advances in testing technology, allow

for the rapid, scalable identification of cognitive and emotional traits—which are more

objective than self-reported survey measures or judgements based on interviews. And AI

can now find and refine complex relationships between these traits and job performance

across very large sets of traits and roles.

Be realistic about what you can predict and what is beyond managerial control.•

Foster trust and reciprocity to coordinate competing interests.•

Experiment frequently and amplify the initiatives and approaches that are most

successful.

•
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For example, our research (in collaboration with pymetrics, a startup using neuroscience

and AI to help companies improve hiring processes, and Professor TejPavan Gandhok of

the Indian School of Business) used digital games to assess individuals’ cognitive and

emotional traits as well as their capabilities in various simulated problem-solving

environments. We found that different neuro-traits reliably predicted success in different

situations, suggesting that science can indeed play a helpful role in identifying talent to

fill new roles. And we found that very few individuals were successful in all

environments—demonstrating the need to effectively align skills with roles.

Furthermore, there were clear differences in how well certain capabilities could be

learned over time. Some capabilities could be learned effectively, indicating that

businesses are able to develop them internally over time—while others could only be

learned very slowly, indicating a need to acquire them externally if they cannot be found

within the organization. (See Exhibit 4.)



THE CHALLENGE OF ALIGNING SKILLS WITH POSITIONS, LIKE

MANY OTHER ASPECTS OF LARGE-SCALE CHANGE, HAS

GENERALLY BEEN BASED ON SUBJECTIVE JUDGMENTS.

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How can leaders ensure they have the proper capabilities to successfully execute change

programs?

TAP INTO EMERGING SCIENCE TO ENHANCE CHANGE

As science and technology advance, more tools for managing change in complex

dynamic environments will emerge. The leaders who are willing to let go of established

models and embrace this frontier will have an advantage in transforming their

organizations in the coming decade.

Some emerging lessons from science and technology include:

Use objective measurements of individuals’ skills, and de-average talent needs in

different parts of the business.

•

Base hire-or-build decisions on the learnability and market for different capabilities.•

Maintain a diversity of skills throughout the organization for when new challenges

arise.

•
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Businesses may be able to identify early-warning signals of impending shifts—for

instance, the threat that their current growth engines will run out of steam—and

understand how to change accordingly. For example, Thorton Tomasetti, a leading

engineering firm, has adopted new metrics to measure its vitality in order to identify

signs of deterioration before they show up in measures of financial performance.

Identify early-warning indicators. Understanding when and how change is

required is no easy task. By the time traditional performance measures signal a

need for change, it is often too late to recover. In some domains, however, scientific

study has revealed early-warning signals—higher-order patterns that predict critical

changes to complex systems. For example, in ecology, certain configurations of

vegetation in a dry region are indicators that the region is about to become

completely barren.

Notes:
•

5 Martin Scheffer et al., “Early-warning signals for critical transitions,”

Nature, September

2009.

Learn how to “nudge” behavior. As business leaders shift from mechanical

approaches to indirect ones that account for uncertainty and complexity, they will

need to identify influential leverage points in the business that may not be obvious.

The emerging study of behavioral psychology can help leaders identify small

interventions that may nudge employees into different, more productive behaviors.

For example, in a randomized experiment Virgin Atlantic found that giving

reminders and fuel use goals to pilots resulted in millions of dollars of cost savings.

Notes:
•

6 Greer Gosnell et al., “A New Approach to an Age-Old Problem: Solving Externalities by

Incenting Workers Directly,” NBER working paper, June 2016.

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However, in the next decade, forward- looking companies will likely leverage

increasingly powerful AI capabilities as an essential part of their change programs. For

example, machine learning has already shown remarkable ability in predicting the

dynamics of some chaotic systems, such as weather.

Notes:

Similar technologies could identify disruptions in the business environment or diagnose

organizational health in real time.

For example, according to analytics startup KeenCorp, deep semantic patterns in Enron’s

internal emails identified latent tensions in the organization, which could have served as

a sign of trouble to observers even if they did not know the full extent of its fraud.

Leverage new program management technologies. As companies adopt an

expanded array of change strategies, they will need new methods of reporting on

and managing their change programs. Emerging technologies may help. For

example, new digital crowdsourcing platforms may offer a template for companies

to gamify change initiatives and gather real-time feedback about what works and

what doesn’t. And dynamic program management platforms can enable leaders to

continuously adjust the portfolio of change initiatives instead of following rigid

timelines.

•

Use AI to enhance change. Lots of organizations are enacting major change so that

they can use artificial intelligence effectively (often a central goal of digital

transformation). But few are using the capabilities of AI itself to enhance major

change programs. Instead, change efforts are still largely designed and managed

with subjective approaches.

•

7 Natalie Wolchover, “Machine Learning’s ‘Amazing’ Ability to Predict Chaos,” Quanta

Magazine, April 2018.

8
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Notes:

This type of analysis could be applied not only to legal risks, but to strategic risks as well.

Major, ongoing change will be necessary to succeed in the next decade. But successfully

enacting organizational change is highly challenging. By recognizing the complexity of

change, and using lessons from science and analytics to address it, leaders can ensure

their companies are best positioned to win the ’20s.

The BCG Henderson Institute is Boston Consulting Group’s strategy think tank,

dedicated to exploring and developing valuable new insights from business, technology,

and science by embracing the powerful technology of ideas. The Institute engages

leaders in provocative discussion and experimentation to expand the boundaries of

business theory and practice and to translate innovative ideas from within and beyond

business. For more ideas and inspiration from the Institute, please visit our Latest

Thinking page and follow us on LinkedIn and Twitter.

8 Frank Partnoy, “What Your Boss Could Learn by Reading the Whole Company’s Emails,” The

Atlantic, September 2018.

How can leaders use the emerging science of change to their advantage?•

Identify the new metrics and analytical approaches that can provide early-warning

signals to your business.

•

Use AI to optimize and enhance the change process itself.•

Monitor ongoing technological and scientific advances to identify new

opportunities, perhaps including generative AI algorithms, biometrics, or control

theory.

•
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Authors

Lars Fæste
Managing Director & Senior Partner

Hong Kong

Martin Reeves
Managing Director & Senior Partner, Chairman of the BCG Henderson Institute

San Francisco – Bay Area

Kevin Whitaker
Head of Strategic Analytics of the BCG Henderson Institute

New York

ABOUT BOSTON CONSULTING GROUP

1 As coined by Deng Xiaoping, who described China’s reform effort as “crossing the river by

feeling for the stones.”
2 Nancy F. Koehn et al., “Starbucks Coffee Company: Transformation and Renewal,” Harvard
Business School Case, June 2014.

3 Tim Greene, “John Deere is plowing IoT into its farm equipment,” Network World, May 2016.

4 Susan Berfield and Matthew Boyle, “Best Buy Should Be Dead, but It’s Thriving in the Age of
Amazon,” Bloomberg Businessweek, July 2018.

5 Martin Scheffer et al., “Early-warning signals for critical transitions,” Nature, September

2009.
6 Greer Gosnell et al., “A New Approach to an Age-Old Problem: Solving Externalities by
Incenting Workers Directly,” NBER working paper, June 2016.
7 Natalie Wolchover, “Machine Learning’s ‘Amazing’ Ability to Predict Chaos,” Quanta
Magazine, April 2018.
8 Frank Partnoy, “What Your Boss Could Learn by Reading the Whole Company’s Emails,” The
Atlantic, September 2018.
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Boston Consulting Group partners with leaders in business and society to tackle their most

important challenges and capture their greatest opportunities. BCG was the pioneer in

business strategy when it was founded in 1963. Today, we help clients with total

transformation—inspiring complex change, enabling organizations to grow, building

competitive advantage, and driving bottom-line impact.

To succeed, organizations must blend digital and human capabilities. Our diverse, global

teams bring deep industry and functional expertise and a range of perspectives to spark

change. BCG delivers solutions through leading-edge management consulting along with

technology and design, corporate and digital ventures—and business purpose. We work in a

uniquely collaborative model across the firm and throughout all levels of the client

organization, generating results that allow our clients to thrive.

For information or permission to reprint, please contact BCG at permissions@bcg.com. To

find the latest BCG content and register to receive e-alerts on this topic or others, please visit

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2021/1/28 Change Management: Definition, Best Practices &

Examples

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– B LO G –

Change Management: Definition, Best Practices &

Examples

Apr 16, 2020 ▪ Approx. 17 min. read

Change management has become one of the most critical success factors for any

business in today’s ever-changing world.

Change management has become one of the most critical success factors for any business in

today’s ever-changing world.

The business world is changing at a fast pace: technology keeps evolving, customer trends

are changing, new market regulations are being launched on a regular basis, and businesses

have to cope with unprecedented global crises.

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💡Download our eBook “10 Principles of Modern Employee Communications” and learn how
to communicate with the modern employee in today’s digital age.

Companies that can’t adapt and grab growth opportunities are most likely to be outcompeted

by agile competitors and even disappear. That’s why preparing for change should be one of

your top priorities.

💡In this blog post, you’re going to learn more about the following topics:

De�nition of Change

Management

3 Types of Organizational Change

Common Examples of When Change Management Is

Needed

Managing Organizational Change During Crisis

Most Common Change Management Challenges

12 Change Management Best Practices

Change Management Models You Can’t Ignore

The Role of Internal Comms in

Change Management

How to Communicate Organizational Change During Crisis

Definition of Change Management

Change management is a systematic approach that includes dealing with the transition or

transformation of organizational goals, core values, processes or technologies.

The purpose of every organizational change management initiative is to successfully

implement strategies and methods for e�ecting change and helping people to accept and

adapt to change.

As organizational changes in the agile workplaces happen daily, change management and

change communication teams have become crucial performance drivers for many companies.

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People are Resistant to Change

A research shows that only 38% of people like to leave their comfort zone. When these people

are presented with a change, they think, “Hey, this is so exciting.” Those positive interpretations

of change result in positive emotional reactions, such as happiness and satisfaction, which

result in greater employee productivity.

The other 62%, however, look at that same exact statement and immediately feel fear and

discomfort. They may think, “Oh great, this change will have an e�ect on my career growth.” or “I

will not do what I like doing any more.” or “Will they keep me in?”.

3 Types of Organizational Change

The 3 most common types of organizational change include:

1. Developmental change – Any organizational change that improves and optimizes on

previously established processes, strategies and procedures.

2. Transitional change – Change that moves an organization away from its current state to

a new state in order to solve a problem, such as mergers and acquisitions and

automation.

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3. Transformational change – Change that radically and fundamentally alters the culture,

core values and operations.

Common Examples When Change Management Is

Needed

With all the changes happening in the business world, change management has become one of

the most important business functions.

Some of the most common examples when change management is necessary to successfully

implement changes within organizations include:

Implementation of a new technology

Mergers & acquisitions

Change in leadership

Change in organizational culture

Times of a crisis

Managing Organizational Change During Crisis
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Under normal circumstances, driving change in the workplace is already quite challenging.

Today, workplace transformation needs to be more agile.

In a survey with nearly 3,000 executives about the success of their enterprise transformation

e�orts, McKinsey found the failure rate to be higher than 60%. But COVID-19 makes

organizational change even more complex and challenging.

As the pandemic continues to spread, businesses have no choice but to review their short-term

as well as long-term strategies.

Some companies have temporarily closed their plants and shops while others have also made

remote work mandatory. More and more businesses are laying o� a part of their sta� because of

business deterioration. As a result, unemployment rates are exploding. For example, more than

16 million people have �led for initial unemployment bene�ts since mid-March in the US.

Businesses are now operating under pressure.

They have to adapt on the �y and they have no visibility on what’s going to happen in the

upcoming weeks. Check out the graph below where WTO shows di�erent scenarios (optimistic

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and pessimistic ones) for the evolution of the world merchandise trade volume in the upcoming

years due to COVID-19. 👇

World merchandise trade volume, 2000‐2022

Source: WTO

In these uncertain times, businesses have to review their plans in no time. They are changing

the way their employees are working as remote work has become the new norm and they also

are rethinking the way their teams are functioning and collaborating. Most companies have

already changed their organizational structure and their work arrangements.

Read on: Remote Work: 20 Ways to Engage and Connect with Your Remote Employees

Companies have to act fast and as a consequence, change is implemented with no smooth

transition, which is highly challenging for both businesses and employees.

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Think about it: employees — including team leaders — have to instantly adapt to new ways of

working and communicating while change management programs usually take years to be

implemented — whether it’s the launch of a new technology or the implementation of a new

internal organization.

Indeed, driving change doesn’t mean equipping employees with a new software or new ways of

communicating. Implementing change requires a preparation phase, a proper internal

communication plan, training programs, and evaluating the success of the program.

“Digital transformation does not happen quickly. Some companies seem to expect it to happen

over the course of a year. In my experience, particularly for larger organizations, closer to �ve

years is more realistic. Even then, the task is never over”,

says Ashley Friedlein, founder of Econsultancy.

Experts have already announced that the future of work is happening now and there’s no doubt

that the way companies are managing organizational change now will have a direct impact on

their ability to ensure business continuity.

Most Common Change Management Challenges

Change is not always perceived as positive, and many employees may be resistant to changes

within their organizations. Therefore, successful business transformation is all about getting

employees’ buy-in and embedding new behaviors in the workplace.

Here are some of the most common challenges that change management professionals

face 👇

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1. Defining goals in a timely

manner

Most changes get implemented with a goal to improve current processes, products, services or

organizational cultures. However, it is critical to identify clear goals and milestones.

Some of the common change management goals and objectives include:

Build a culture of innovation

Change or update company’s best practices

Implement new technology

Establish milestones and incentives programs

Implement knowledge sharing initiatives

Shift in targeted customer base

2. Poor leadership and lack of alignment

Leadership has a big impact on employee engagement. If your leaders are not convinced about

the bene�ts of change, it will be hard to implement it.

Poor leadership and lack of alignment among the leaders are some of the main reasons for

organizational change fails. On the other hand, great leaders know how to inspire their

workforce and embrace the change.

Read on: Top 5 Communication Skills and How to Improve Them

3. Identifying the resources needed to make change a success

Before starting the change process, identifying the resources and individuals that will facilitate

the process and lead the change is crucial for success. However, it can be hard to identify those

resources and budgets before the process even starts.

4. A Lack of agility and slow approval process

Organizations that are not agile struggle to implement changes. Slow approval processes can

cause delays in change implementation.

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Therefore, it is important to have everyone on the same page in order for the process to get

implemented smoothly and on time.

5. Planning the next steps

Every change management process should have a well set plan. The plan should consist of a

timelines, and change milestones should be identi�ed. Without planning, it may be hard to

understand the overall success of the change process.

6. Fear and conflicts

Changes within organizations can develop emotions of uncertainty and fear. This may cause

employees take their frustrations out on each other. Here, it is leaders’ responsibility to overcome

the di�culties and resolve con�icts.

An active leader should always be ready to dive deeper into the problem while working in

accordance with their organizational change management.

7. Resistance to change and lack of commitment

Some employees are resistant to change, do not want to collaborate or commit to new practices.

Leaders should be able to address resistance on a psychological level and proactively remove

behavioral barriers that restrict change.

8. Poor communication in the workplace

Communication is crucial for successful change management, and the cost of poor

communication can be signi�cant. Every employer that has a successful change management

team expresses the need for constant communication during the change experience.

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9. Aligning all the teams with the new strategy

Having everyone on board and informed before and during the implementation process may be a

challenge. This is especially true for large organizations with various o�ces and departments

across the world. Therefore, global and interdepartmental communication has to become a

priority.

10. Updating everyone on the new materials, policies and procedures in a timely

manner

Changes should be documented and those documents should be easily accessible and

shared with the employees.

Every highly-e�ective change management strategy keeps all changes well-documented and

transparent.

Read on: The Ultimate Crisis Management Checklist for Employers

12 Change Management Best Practices
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Change management processes can be very complex. Additionally, change in the workplace can

cause high levels of stress among employees.

However, there are some rules and best practices every organization should follow.

Here they are.

1. Define clear goals

Every change management initiative should be clearly de�ned. Even though SMART goals are

not easy to de�ne for change management, companies should strive towards setting up as

clear goals as possible.

This way, employees and leaders will have something to reference to when evaluating their

change management

e�orts.

2. Be honest and transparent

Over 30% of employees say that their employer is not always honest and truthful.

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In order to implement transitions successfully, employers should be honest and transparent.

As most employees don’t feel comfortable with changes, being transparent at every step of the

change management process helps build trust and connection with employees.

3. Train and reassure your teams

Support your employees with reassurance, o�er new training sessions and give employees

time they need to adapt to new practices. Empathy and reassurance help fasten the process and

eases future organizational changes.

Yet, many line managers don’t even understand why the change is happening.

4. Encourage conversations and communicate regularly

Employee relations have a big impact on encouraging conversations before, during and after the

changes are implemented.

Start a conversation among your employees in order to �nd out how they feel about the new

initiatives.

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Understand that true communication is a two-way conversation.

Read on: Interpersonal Communication: De�nition, Importance and Must-Have Skills

5. Listen to your employees

When driving engagement and communication, you should not be the only one talking. Listen to

what your employees have to say. Allow them to lead the conversation where employees can

ask questions, comment and suggest their ideas for improvement.

6. Bring your leaders on board

The evidence is clear- excellent change management increases business outcomes of change

initiatives. So why is it so di�cult to communicate these bene�ts to business leaders?

Companies should work on proving the real ROI of change management and communicate

that to the business leaders to bring them on board and support the change.

7. Choose the right communication tool

Millennials in the workplace expect an easier way of communication than through emails. In

fact, many emails are never read which causes important information to get lost.

Choose the right employee communication and engagement solution that your employees

will actually want to use.

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Make sure that your solution is mobile friendly. Younger generations are used to being able to

do everything on their mobile phones. Company tools should, for that reason, be mobile-friendly.

8. Empower your employees

Empower your change management leaders as well as employees to engage in the change

process by giving them freedom to make their own decisions and implement new ideas.

If your employees don’t feel empowered, the engagement level will drop and result in

resistance to change.

9. Encourage knowledge sharing

Some employees will learn and adapt to change faster than the others. However, knowledge

sharing among employees can fasten this learning process signi�cantly.

Employee collaboration tools such as Smarp enable organizational knowledge sharing in a way

that is easy and fun for employees.

10. Document and make information easily accessible

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Documenting everything does not help if this information is not easily accessible to

employees. Having a central place where all the important documents and information are kept,

makes change management much more e�cient.

Did you know that employees, on average, spend 2.5 hours every day searching for

information? In the process of change management, this can be very frustrating and

discouraging to employees. Drive the #NoSearching Revolution in your company!

11. Recognize and reward

77% of employees say that they would work harder if they were recognized for their work.

Therefore, this approach can be a great motivation to comply with and implement the changes

faster.

Recognize and reward employees for accomplishments and for adopting new behaviors

during the transformation process. Celebrate the wins and milestones.

12. Make it social

If you are implementing a new technology solution you are proud of, share it publicly! Modern

employee communication tools allow you and your employees to easily share information both

within and outside your organization.

Having employee advocates can also be a huge help for your recruitment and talent acquisition

e�orts.
Change Management Models You Can’t Ignore

There are many change management models out there. However, we have chosen the top 3

models used by successful companies across the world.

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1. Kotter’s change management theory

This change management theory is one of the most popular and adopted ones in the world. It is

divided into eight stages where each one of them focuses on a key principle that is associated

with the response of people to change.

Increase urgency – Create a sense of urgency among the people so as to motivate them

to move forward towards objectives.

Build the team – Get the right people on the team by selecting a mix of skills, knowledge

and commitment.

Get the vision correct – Take into account not just the strategy but also creativity,

emotional connect and objectives.

Communicate – Openly and frequently communicate with people regarding the change.

Get things moving – Get support, remove the roadblocks and implement feedback in a

constructive way.

Focus on short term goals – Set small goals and achievable parts is a good way to

achieve success without too much pressure.

Don’t give up – Be persistent while the process of change management is going on, no

matter how tough things may seem.

Incorporate change – Reinforce and make it a part of the workplace culture.

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2. ADKAR Model

ADKAR model or theory of change is a goal-oriented. This makes it possible for change

management teams to focus on activities that are directly related to the goals the company is

trying to achieve.

The model can be used by change managers to �nd out the various challenges in the process of

change management so that e�ective training can be o�ered to the employees.

ADKAR Model stands for:

Awareness – of the need and requirement for change

Desire – to bring about change and be a participant in it

Knowledge – of how to bring about this change

Ability – to incorporate the change on a regular basis

Reinforcement – to keep it implemented and reinforced later on as well.

3. Lewin’s Change Management Model

Lewin’s Change Management Model is one of the most popular, most accepted and most

e�ective models that make it possible for companies to understand organizational and

structured change. This model consists of three main stages which are: unfreeze, change and

refreeze.

Unfreeze: The �rst stage of the change process is the preparation for change. Here,

employers must get prepared for the change and explain to people why the change is

necessary. As most people are resistant to change, this step helps to break this status

quo.

Change: In this stage, the change process takes place. Good leadership and e�ective

employee communications are crucial for this step.

Refreeze: In this stage, the change has been accepted. This is the time when the

employees start going back to their normal pace and routine. This last step requires

leaders to make sure that the changes are adopted and used even after the change

management objectives have been achieved.

The Role of Internal Communications in Change

Management

According to Michael O’Malley, “it isn’t the technology itself that IT projects trip over”.

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In a research by PMI, of 256 companies that were surveyed, only 14 percent of all failures can be

chalked up to a company’s inability to cope with technology.

The other 86 percent owe to some common management challenges:

improperly de�ned objectives (17 percent),

unfamiliar scope (17 percent),

lack of e�ective communication (20 percent) and,

poor project management skills (32 percent)

As a lack of, or ine�ective, communication often cause change management projects to fail,

companies now have to reconsider their internal communications e�orts.

How to Communicate Organizational Change During

Crisis?

When it comes to change management, internal communication plays an even more critical

role today. Indeed, businesses have to �nd e�ective ways to communicate the abrupt changes

they’re implementing right now so that employees can understand where the new strategies and

adjust their work accordingly.

Read on: Crisis Communication — How to Communicate E�ectively with Your Employees

Broadly speaking, when driving change during the pandemic, you need to:

Explain to your employees the changes you’re implementing as well as the

di�erent steps your organizational change plan includes.

Tell them the reasons why you’re implementing these speci�c changes and the

impacts they may have on their work

There’s no organizational change plan without objectives and goals. Clearly

explain to your employees the objectives you’ve set and help them identify the impacts

their work will have on the team’s ability to reach these goals.

Encourage your employees to ask any questions they may have in mind and most

importantly, make sure you are able to answer all their questions. That point is

extremely important when it comes to driving change during the pandemic. That’s one of

the best way to reconnect and build trust with your remote teams. If needed, appoint a

spokesperson that will be able to keep the dialogue with your employees open, the same

way as you would appoint a spokesperson as a part of a crisis communication plan.

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We’ve also asked our clients to share their best practices for communicating change with

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1. Share the new company policies and procedures with your teams in a timely manner

2. Share safety tips with your employees on a daily basis. Sharing wit them informative and

educational materials such as short videos is a great way to help them protect

themselves from the pandemic.

3. Monitor updates from Governments and other local authorities and instantly share

them with your employees

4. Make sure you are able to inform your employees about urgent matters

5. Know your employees and the content they are interested in

6. Make it easy for your teams to keep up with the latest news related to the pandemic

7. Track the e�ectiveness of your change plan

8. Use a mobile app so you can reach all your employees, no matter where they are

9. Align your communication e�orts so your messages are consistent, no matter with

whom you share them. It’s all about building trust in these times of uncertainty.

What’s next? Download the eBook “10 Principles of Modern Employee Communications” where

we share tips & best practices for successfully communicating with your employees in today’s

digital age.

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– R E L AT E D ART I C L E S –

WRITTEN BY

Valène Jouany & Kristina Martic

How to Improve Cross-Functional Collaboration in the Workplace